City agreement allows FCR to build 44% smaller Phase 1; what about NYC's extra $105M?

Despite assertions by Forest City Ratner officials that “all of Atlantic Yards... will be built," the State Funding Agreement, which the Empire State Development Corporation (ESDC) quietly released last month, gives the developer 6+ years to build the arena, 12+ years to build the five towers in Phase 1, and an unspecified amount of time to build the 11 towers in Phase 2.

A look at the previously-unreleased City Funding Agreement signed last September shows the developer has an even gentler deal: modest penalties for delay, plus allowance for a much smaller Phase 1 than that outlined in the General Project Plan passed by the ESDC in December 2006.

(I obtained the City Funding Agreement from the New York City Economic Development Corporation, or NYCEDC, via a Freedom of Information Law request. Warning: 13+ MB.)

The City Funding Agreement involves NYCEDC and ESDC, while the state agreement involves ESDC and the developer. There's considerable overlap between them. (Click on all graphics to enlarge.)

• The city agreement casts further doubt on the schedule for affordable housing units, perhaps the main generator of political support for the project.


• It includes no penalties as long as the developer builds, within 12+ years, 1.5 million square feet in Phase 1--some 44% smaller than promised less than a year earlier.


• It permits a scenario of only 300 affordable housing units by 2020


• With such a smaller Phase 1, it further reduces expected tax revenues.


• It does not address the city's $105 million contribution for infrastructure, raising the possibility that, upon the project's demise, the city could recover only its initial $100 million outlay.


• It confirms that the initial $100 million--once intended at least in part for infrastructure--will be used to reimburse Forest City Ratner for the seemingly generous checks the developer wrote to owners of properties destined for the arena footprint.


• It requires larger penalties for a delayed arena than a delayed Phase 1, suggesting that the arena is more of a priority.


• It sets a schedule for relatively modest penalties; an arena three years late (given the grace period), delayed to 2018, likely would cost the developer little more than $10 million in damages to the city.


• Such relatively modest penalties also apply to Phase 1 delays; should the Phase 1 site lie fallow until 2027--nearly two decades from now--the six-year delay (given the grace period) likely would cost the developer only $17 million in damages to the city.


• It also poses relatively small penalties if FCR abandons the project within three years; that suggests that a decision to pull the plug, should it be made, would come sooner rather than later.

City amplification?

Given the issues raised by the document, I posed several queries to NYCEDC. Agency spokeswoman Janel Patterson provided some limited factual answers, but cautioned, "Questions involving hypotheticals or processes are not topics we can address."

Those topics, however, are important, because they shape the incentives and pressures on the developer. Perhaps they’ll come up if the City Council addresses Atlantic Yards in an oversight hearing. For now, increases in construction costs and losses by the Nets basketball team may be more significant costs calculated by the developer.

(Note that, while Phase 1 has in the past been used to define the Arena, the four towers around it, plus the tower at Site 5, in this case, Phase 1 is defined as those first five towers.)

Oversight coming?

Indeed, when I summarized my findings for City Council Member Letitia James, the project's leading political opponent, she said she had no knowledge of the agreement. She said that both the Council's Contracts Committee, which she chairs, and the Economic Development Committee should look into the deal.

"I’m shocked that liquidated damages are higher" for an arena delay than for a Phase 1 delay, James said. "And why is the penalty so minimal?"

Also, given that the State Funding Agreement, in certain circumstances, would require repayment of state funds advanced for infrastructure, so should the City Funding Agreement, she concluded.

Is there a separate agreement between NYCEDC and Forest City Ratner regarding that $105 million contribution for infrastructure? There's no reference to it in either the city or state funding agreements, which raises the question of whether the city could ever get some of that money back.

"There is no such agreement at this time," Patterson replied, which could mean 1) they're working on it or 2) they forgot about it.

City oversight might fulfill some language in the document, a contract between NYCEDC and ESDC, which states somewhat conclusorily, “Whereas, the City and NYCEDC have determined that it is in the best interest of the people of the City that ESDC undertake the Project and desire to fund ESDC for the Land Acquisition Costs.”

While the City Council did authorize the $205 million in the budget, there was no vote or debate in City Council over the project as a whole.

A smaller Phase 1

Though the entire project was "anticipated" in the ESDC's General Project Plan to take ten years, the State Funding Agreement revealed that Forest City Ratner has six years after the close of litigation and the delivery of property via eminent domain to build the arena, and 12 years to build Phase 1 of the project before penalties--repayment of yet-unspecified portions of the state's $100 million in funding, plus liquidated damages to the city--kick in.

The City Funding Agreement grants even more slack, since it defines “Substantial Completion” of Phase 1 as the construction of at least 1.5 million square feet within those 12 years.
That’s 44% less space than that the 2.69 million square feet “expected” in the General Project Plan (right) approved by the ESDC in December 2006.

(How many buildings is 1.5 million square feet? According to a document in the General Project Plan delineating maximum building heights and square footages, the two largest towers, including Building 4, at the southwest corner of Sixth and Atlantic avenues, and the flagship Miss Brooklyn, conceivably could meet the 1.5 million sf minimum. However, that’s now unlikely, since Miss Brooklyn already seems to have been reduced. The city and state agreements incorporate a document that defines Phase 1 as five towers. Thus, the required 1.5 million square feet could mean five smaller towers. Or it could mean three towers completed within 12 years, with the other two completed at some later date.)

While a smaller Phase 1, once completed, should have less of an impact on traffic and transit, a longer buildout might cause other complications, such as from continued construction.

I asked NYCEDC’s Patterson to “explain the rationale for agreeing that building no more than 1.5M sf generates no penalty,” but was told that was among the topics they can’t address.

Less affordable housing

A smaller Phase 1 likely would bring less affordable housing, given the requirement that 30% of housing built in Phase 1 be affordable.

Given the timetable allowed in the State Funding Agreement, Forest City Ratner could, without penalty, build fewer than 300 affordable units--and only 120 low-income units--over 12 years. (That 12-year endpoint, in a best-case scenario, could be 2020 if litigation clears later this year and properties are delivered via eminent domain, but more likely would come a year or two later.)

How do I calculate 300 units over 12 years? For simplicity’s sake, I assume 500,000 square feet devoted to office space and 1 million square feet of housing. (Actually there’d be some space for retail and possibly a hotel; right now, the developer describes Miss Brooklyn as an office tower with 528,000 sf of zoning rights, though no anchor tenant has emerged.)

If 1 million square feet of housing means 1000 units (at 1000 square feet per unit), 30% of that would result in 300 affordable units. Of the 300 affordable units, 40% would be low-income.

Lower revenues

A smaller Phase 1 would mean lower revenues than the figures predicted in state documents. The state estimates presumed a project built within ten years. The slow buildout permitted in the state document--6+ years for the arena, 12+ years for Phase 1--was the first step in lowering the revenues.

The agreement that "Substantial Completion" of Phase 1 requires only 1.5 million square feet further diminishes such expected revenues.

The missing $105 million

Should the arena or Phase 1 be delayed, the developer would have to pay a schedule of liquidated damages, which I’ll discuss below. Should the project be abandoned, the City Funding Agreement, oddly enough, apparently requires repayment of only the initial $100 million promised by the city.

The document makes reference to “City Funding” of $100 million, defining it narrowly as funds used to help the ESDC buy the arena site--essentially, to reimburse Forest City Ratner for purchases already made. It does not offer a more commonsense definition of “city funding,” which presumably includes the $105 million added in 2007, leading the city to summarize (right) contributions as $205 million.

While the State Funding Agreement requires the developer, should the project be delayed or abandoned, to repay portions of the $100 million in state money advanced for infrastructure, the City Funding Agreement requires the repayment of only the initial $100 million, which the agreement defines as “Disbursements.”

So it may be that the additional $105 million, which like the ESDC’s payments, is directed at infrastructure, would not have to be repaid. Or, as Patterson's cryptic statement left open, another agreement may be under discussion.

Money for infrastructure, not benefit FCR?

Does that additional $105 million benefit just this project, or the neighborhood in general? City officials have suggested the latter. In January 2007, Deputy Press Secretary John Gallagher explained, "The additional funding is for infrastructure improvements, several of which would have been required with or without the construction of the Atlantic Yards Development and others that are necessary regardless of what is built on the site."

Mayor Mike Bloomberg, according to the Brooklyn Paper, attributed the higher allocation to the “rising cost of cement and steel,” adding “We have a commitment to pay for infrastructure costs and we will meet that commitment."

Doug Turetsky of the Independent Budget Office suggested to Neil deMause of the Village Voice that the city's additional expenditures were not generic: "some of which might have been on the books prior to Atlantic Yards, but some substantial amount of which is likely related to the scale of the project—such as the need for expanding sewer and water capacity."

In other words, maybe some of the money does benefit the developer. After all, Forest City Ratner officials apparently agree. Executive Joanne Minieri told investment analysts earlier this month:
We have executed the funding agreement with the city and state for the $200 million of subsidy and received an additional $105 million allocation from the city.

And executive Chuck Ratner of parent Forest City Enterprises followed up:
[J]ust in these past six or eight months, we got the various governmental agencies, state, city, borough, in New York, to increase their commitments to Atlantic Yards by 105 million dollars on top of the 200 [million] they committed. We still need more.

City contribution: infrastructure, property

The use of all $100 million to buy property was not explicitly contemplated in the nonbinding Memorandum of Understanding (MOU) signed in 2005. It stated (p. 5), The City’s capital contribution shall be used for the same purposes as the ESDC’s capital contribution [site preparation and public infrastructure improvements], except that the City's capital contribution may also be used to fund a portion of the costs of acquisition of the Arena Site (other than the MTA Properties).
(Emphasis added)

That suggests that city funds would be used for both infrastructure and property acquisition. The word “except” allows the city to use its capital contribution for property acquisition, but the phrase "may also" suggests that the $100 million would not be used exclusively to buy property. But the MOU was not binding.

(Last year, an NYCEDC spokeswoman said the MOU “had always included the possibility of buying land, as well as improving the infrastructure,” according to the Daily News. True, but it didn’t suggest that it would be used only to buy land.)

The “portion” of the costs for acquisition of the arena site comprises a large majority of those costs. While the city has advanced $100 million, plus a token $10 (above and right), another page included in the funding agreement (below) cites $103.5 million as the aggregate cost so far for properties on the planned arena block: Dean and Pacific streets, and Sixth and Atlantic avenues.

A few buildings and one condo are still not owned by Forest City Ratner, and some buildings owned by the developer have tenants with rent-stabilized leases who are suing the state. The cost of purchasing the extant buildings, either through negotiation or via eminent domain, as well as potentially settling with the tenants, would presumably be added to the aggregate cost.

"Stop Payment"

Some Brooklyn City Council members, at a hearing in March 2007, expressed dismay that city money would go to property acquisition, not infrastructure. And citizen groups at a protest last June made the same point, calling for “Stop Payment.”

The potential for a subsidy request greater than $200 million initially pledged by the city and state should’ve been evident to city officials well before the MOU was signed 2/18/05. Seven months earlier, as I reported, a 6/28/04 business plan submitted by FCR indicated that infrastructure and condemnation costs had already reached $221.2 million, and that costs were rising.

So government officials should have known that the developer might request a greater subsidy. However, when the project was approved in December 2006 by the ESDC, the official documents cited only a $200 million subsidy pledge.

The $105 million increase was announced only in January 2007, after the project had been approved. Had the expected increase in subsidy been made public earlier, would the project have faced more protest?

City money for *new* acquisition of land?

Did the city make clear that the public funding would go to reimburse Ratner for properties already purchased? Not quite. A hearing last year of the City Council Committee on Finance/Economic Development included this exchange between Council Member James and NYCEDC's Seth Pinsky:

JAMES: The other $100 million, which is unspecified and is basically one big pot; what is that $100 million for? Does anyone have any idea?

PINSKY: The $100 million will be exclusively for acquisition of land, to reimburse or pay for new acquisition of land for the project. None of it will go towards condemnation.

Pinsky’s language was not inaccurate, but a little disingenuous, since the $100 million will not be used for new acquisitions, and he was in a position to know that, though he may not have known yet. A look at the list of properties purchased as part of the Arena Land shows that all are on the map of properties owned or controlled by the developer as of 11/1/06.

Generous developer?

Given that it’s now clear that the money would be used for reimbursement rather than new purchases, now we know that the seemingly generous payments made by the developer depended on taxpayer support. (The property owners had another reason to deal, of course: the threat of eminent domain.) So when project supporters like Errol Louis claim that some property owners were “newcomers who made out like bandits,” they should consider the additional context. (More here.)

Even if it had been Forest City Ratner’s own money, the developer’s willingness to pay an apparent premium was also an opportunity to acquire land that would increase enormously in value thanks to the state override of zoning.

Liquidated damages for delays

The City Funding Agreement posits a convoluted schedule of liquidated damages should either the Arena or Phase 1 be delayed. (See Exhibit I, p. 265-70 of the PDF.) Essentially, it assesses penalties that are keyed to both the extent of delay and whether the delay begins sooner rather than later.

I asked Brooklyn Law School Professor David Reiss, who specializes in real estate law, to take a look at that section. He suggested that, while the schedule may seem generous, he couldn’t ascertain how fair the deal was, given that he hadn’t seen the whole document nor was he familiar with the overall finances of the deal.

Liquidated damages, he explained, are a common solution in real estate deals, offering advantages to both sides--guaranteed calculation of damages vs. predictable costs, plus the opportunity to avoid litigation.

“The developer seems, as far as I can tell, to have a very long period (as reflected in the various Outside Dates provided for in Exhibit I) in which it has to do its work before the liquidated damages provisions kick in,” he commented. “The liquidated damages seem to come in two phases. A relatively modest phase (the first five years) and a more punitive phase (year six on) where the liquidated damages is at least twice as high as at the end of the first phase.”

“I would also note that the liquidated damages for the Arena being late are significantly higher than for Phase I being late (the latter being roughly five times higher),” he added.

(Note that the schedule at right does not apply directly to the damages the developer would have to pay; rather a "multiplier," beginning at 2%, would be applied, thus resulting in significantly lower payouts.)

“These liquidated damages provisions seem to provide significant redress to the City if the Developer deviates from the plans of, delays, or terminates the Project," he concluded. "Determining whether the amount of redress is proportionate to the overall size of the Project is beyond the scope of my analysis.”

Indeed, my suggestion is that the redress seems rather modest.

A delayed arena

The document gives an example of a late arena. It assumes that Year 0--the date of first funding --begins on August 15, 2007 and the Effective Date--the date by which “all litigation... shall have been sufficiently concluded so as to permit such financing and construction to proceed.... [and] ESDC has acquired and delivered vacant possession of the Project Site”--does not occur until November 10, 2014. (That assumes a much longer litigation process than most people expect.)

That means the Arena Outside Date--six years later--would be November 20, 2020, Year 13 after the initial funding. Upon that Arena Outside Date, the developer would have to deliver an Arena LOC (Letter of Credit) equal to three years of Liquidated Damages. That Arena LOC is calculated by applying a multiplier (2% for the first year, 3% for the second, etc.) to Column B of Schedule A. Thus the LOC would be the sum of the first three years, or 2%+3%+4% of the Column B amount, or $14,850,000. That would be the total due if the arena were three years late.

(If you click on the graphic to enlarge, the sum of $14,850,000 should be visible under the first shaded section. The bottom shaded section has two lines. The Total Due Upon Substantial Completion is $103,950,000, while the Total Less Arena LOC Amount is $89,100,000. Note that the Total Due assumes an arena eight years late, rather than three, and that the sum due increases steadily for the first six years, then doubles.)

The dates in the above example are not necessarily realistic. First, the date of the first city Disbursement was 2/22/08, NYCEDC's Patterson confirmed, so we're in Year Zero. Also, the Effective Date more likely would occur in 2009 or 2010.

Assuming the delivery of property via eminent domain by 2009, the Arena Outside Date would be six years later, in 2015, Year 7. That means the multiplier would be applied to $115,000,000, according to Schedule A, not $165,000,000. Thus an arena delayed until 2018--three years late--could cost the developer a total of $10,350,000.

The State Funding Agreement also would require repayment of a portion, not yet established, of the $100 million from ESDC.

A delayed Phase 1

The document gives an example of a delayed and partly complete Phase 1. It assumes that Year 0--the date of first funding--begins on September 25, 2007 and the Effective Date occurs on December 1, 2009.

That means that the Phase 1 Outside Date--12 years later--would be December 1, 2021, which is Year 14. For the purposes of the example, the developer has completed 1.1 million square feet, less than the 1.5 million square feet required.

The developer would have to deliver a Phase 1 LOC (Letter of Credit) equal to three years of Liquidated Damages. That adds up to a little more than $2.6 million. As the example shows, if the additional 400,000 square feet is not finished within ten years, the total damages would be $29.3 million.

(If you click on the graphic to enlarge, the sum of $2,638,350, the Phase 1 LOC, should be visible under the first shaded section. The bottom shaded section has two lines. The Total Due Upon Substantial Completion is $29,315,000, while the Total Less Phase 1 LOC Amount is 26,676,650. Note that the full chart assumes Phase 1 to be ten years late, rather than three. Note that the sum due increases steadily for the first six years, then doubles.)

Note that a “completion multiplier” diminishes the amount owed by 53.3% or nearly half. Thus, if Forest City Ratner were to build none of Phase 1, the completion multiplier would be 1 and the damages roughly double each year: about $5 million over the first three years, plus another $12 million over the next three years.

So an 18-year delay after the Effective Date--the 12-year grace period, plus six years of delays that would generate penalties--means the developer could sit on the project until 2027 and pay only $17 million to the city.

That's not necessarily realistic, given the developer's promises and the inevitable pressure from city officials, but it is, according to the city document, possible. So it may give the developer leverage in either gaining additional subsidies or access to scarce affordable housing bonds.

The State Funding Agreement also would require repayment of a portion, not yet established, of State Funding Payments.

Liquidated damages for abandonment

And what if Forest City Ratner abandons the project? Well, the City Funding Agreement states that, if the project is abandoned or terminated before the Arena Outside date (6 years after the close of litigation and the delivery of property), the ESDC--not the developer--would repay the Disbursements, up to the $100 million total, to NYCEDC, plus Liquidated Damages. Again, the additional $105 million is not mentioned.

Depending on the date of abandonment, the Liquidated Damages could be modest. It’s not clear to me where those Liquidated Damages come from, but possibly from refunds to ESDC of state monies advanced to the developer.

For example, if the final disbursement of city funding occurs in 2010, two years after the first disbursement, and the project is abandoned by 2011, the Liquidated Damages would be calculated according to Year 3 in Schedule D, and would total only $8 million.

If the delay is one year longer, the damage total would leap to $29 million. (Note that Schedule B applies to a scenario in which the final disbursement occurs during the same year as the first disbursement; Schedule C applies to a scenario in which the final disbursement occurs one year after the first disbursement.)

The more than threefold jump between the penalties if the project is abandoned in the first three years and the penalties if it's abandoned in the following three years suggests that, should Forest City Ratner decide to ditch the project and sell the team to New Jersey investors--a scenario which, the Real Deal reported, is somewhat more plausible, despite the developer’s denials--the decision should be made in three years, by 2011.

It’s unclear to me what happens if the developer abandons the project after the arena is built. I queried NYCEDC’s Patterson: "What if the project is abandoned *after* the Arena Outside Date? Is there any provision for that, or does some other clause of the agreement apply?”

I got no answer, but the explanation may lie elsewhere in the documents. Still, it would be worthwhile to have NYCEDC officials answer some questions.

Questions unanswered

Several important issues raised in both city and state funding agreements have yet to be resolved, and the ESDC has so far been reluctant to provide details.

Neither set any deadline for the completion of the 11 towers of Phase 2; indeed, both documents, as in the excerpt from the City Funding Agreement at right, allow for the distinct possibility of the General Project Plan being amended.

A yet-unannounced completion date, the “Final Deadline,” according to the State Funding Agreement, will “take into account the need for satisfaction of Government Authorities’ obligations to the Project.”

What does “satisfaction of... obligations” mean? Given that the next paragraph in the state agreement cites “Governmental Authorities making available to the Project affordable housing subsidies then customarily available,” it seems that the Final Deadline depends significantly on such subsidies.

Right now, there are many projects competing for a limited supply of such subsidies. Forest City Ratner could successfully compete for such subsidies. Or the supply could be increased. For now, however, the issue is murky, which may be why no Final Deadline has been announced.

Revisiting that May 2004 Daily News scoop about Ratner's generous buyouts

On the front page of the 5/14/04 New York Daily News, the headline proclaimed "BONANZA."

The headline on page 5 was no less breathless: "FOR THESE CONDO OWNERS, B'KLYN NETS ARENA DEAL IS . . . SLAM DUNK; RESIDENTS GET A COOL MIL TO GET OUT OF RATNER'S WAY."

Now that we know that taxpayers will pay for nearly all the private property developer Forest City Ratner purchased in the arena block, including the building pictured, it's worth looking back at the article and, with hindsight, revising selected paragraphs.

It would have been a different kind of scoop.

Some revisions

Real estate tycoon Bruce Ratner is showing Brooklyn homeowners the money.

Revised: Real estate tycoon Bruce Ratner is showing Brooklyn homeowners taxpayers’ money.

He's turning residents of one building into instant millionaires so they'll go quietly - letting him knock down their homes to make way for his controversial $2.5 billion Nets arena and housing complex.

Revised: Taxpayer funds are turning residents of one building into instant millionaires so they'll go quietly - letting him knock down their homes to make way for his controversial $2.5 billion Nets arena and housing complex.

That means people who paid about $600,000 for a swank three-bedroom, 1,300-foot condo just last year are being offered a cool $1.2 million to flee.

Revised: That means people who paid about $600,000 for a swank three-bedroom, 1,300-foot condo just last year are being offered a cool $1.2 million to flee. While it looks like the developer was being generous, the enormous increase in development rights made it worthwhile--even if he had to pay, which he doesn’t.

..."It's a lot of money," said another woman, who did not want her name used, citing an internal building pact to keep mum about the deal.

Nearly all the 30 owners in the eight-story condo - a renovated warehouse called the Atlantic Arts Building - are negotiating with Forest City Ratner.

One holdout remains.

Revised: One holdout remains. That holdout, Daniel Goldstein, became spokesperson for Develop Don’t Destroy Brooklyn, and has been responsible for--take your pick--helping delay the project through litigation and helping blow the whistle on a sweetheart deal.

"They're kind of mimicking what they did at MetroTech, which is to treat people equitably," said Atlantic Arts Building developer Marc Freud, referring to the downtown Brooklyn office and university complex Forest City Ratner built in the early 1990s.

Revised: "They're kind of mimicking what they did at MetroTech, which is to treat people equitably," said Atlantic Arts Building developer Marc Freud, referring to the downtown Brooklyn office and university complex Forest City Ratner built in the early 1990s. Equitable treatment in this case is eased by the public's money. And those taking the buyouts also knew that eminent domain loomed if they didn't deal.

Ratner lowers our architectural expections; will Gehry ease away?

Yes, the "news" (as hinted by the New York Observer) from the fairly gentle profile NY1 ran last night of Bruce Ratner is that the Atlantic Yards developer is talking populism, not Gehry-ism:
“We need jobs, we need shopping that's appropriate and the right price and quality goods, we need supermarkets that provide food that is of quality and well-priced, we need housing, and you know what? The architecture is important, but it's not that important,” says Ratner.

"I want to do great architecture, but I have to say something, which is that, if one is going to boil life down to architecture, then you know what? It's not for me,” he adds.

Pending estrangement?

Interviewer Budd Mishkin, host of the "One On 1" series, didn't raise the suggestion, but to me it hinted as a potential estrangement from Frank Gehry. (Gehry's not mentioned at all in the piece, though models of his buildings are evident and, of course, such video segments are edited.)

After all, Ratner not so long ago was emphasizing his commitment to architecture: "I’ve been talking for ten years about trying to use ‘design architects’ instead of ‘developer architects," he told New York magazine's Kurt Andersen in 2005. (Citation below.)

Gehry's never designed an arena, so to him that may be the prime lure of the Atlantic Yards commission. Given that most of the project, including the Miss Brooklyn tower (which Gehry called "my ego trip"), has been delayed and layoffs have occurred in Gehry's office, it's possible that Gehry--who has publicly said that typically he'd bring in other architects to work with him--sees a light at the end of the tunnel.

Ratner is now talking about housing and jobs and big box shopping, not architecture.

(The profile offered a look at Ratner in his earlier days, right, as well as a reasonable survey of his life and career.)

Some ironies

Oddly enough, Ratner was making his point while in the invitation-only Atlantic Yards Information Center, behind closed steel doors on the third floor of the Atlantic Center mall, where he's already apologized for the architecture. ("It's not something that we would build again," he told the New York Times in 2004.)

And given that Atlantic Yards would have relatively little retail--and none of the big box stores (at least according to former project executive Jim Stuckey) in the two malls--it was a bit of a nonsequitur.

But earlier in the piece he defended the malls:
"I'm proud of both of these, because the jobs they create number one and number two they save people money and allow people to buy good quality goods at lower prices and this serves a large part of Brooklyn. So, you know, those who focus on the architecture are frankly misguided about what's really important in this world,” says Ratner.

Mishkin suggests another irony:
It’s ironic [that Ratner has been the subject of protests], because he himself has taken to the streets to protest, before the start of the Iraq war, and especially during his Columbia Law School days in the ‘60s.

Actually, it's not so ironic. More ironic is brother Michael Ratner's committed activism while supporting machine politicians who might help Forest City Ratner.

Also ironic is coupling a scene of the signing of the Community Benefits Agreement, a private deal outside the purview of government (though Mayor Mike Bloomberg was a witness), with Mishkin's narration:
Ratner says his agreement with the city requires him to build low- and moderate-income housing and he believes the Atlantic Yards project will create jobs.

The question is not whether Bruce Ratner thinks a project getting significant subsidies will create jobs, but whether the special benefits are worth it.

Saving Brooklyn

Ratner gets to make the point that Brooklyn has changed significantly:
"I could remember initially when we built the MetroTech, there were bullet halls in the glass in the office buildings where the workers were and it was a very difficult sell to get companies to decide to move to Brooklyn as opposed to moving out of the state,” says Ratner.

It's an explanation for why MetroTech was designed the way it was, and a lot of people give Ratner more slack for MetroTech than a project like Atlantic Yards. What's left out of the NY1 profile, regarding MetroTech, the Atlantic Terminal and Atlantic Center malls, and Atlantic Yards, is how Forest City Ratner leverages public subsidies, tax breaks, and other benefits to build its projects.

The piece concludes:
“Nobody even knows I was consumer affairs commissioner, so you know what? I'm not building the stuff for legacy,” says Ratner. “I'm building it because I think that doing the residential we're doing, bringing the arena, bringing the team is important, and when it's built I think that'll be realized.”

Ratner can say all he wants about whether the project is "important," but the words of his cousin Chuck Ratner also deserve notice: "It's a great piece of real estate."

Ratner's conversion, in New York magazine

A look back shows how Ratner's embrace of starchitecture was saluted by critics, albeit sometimes with skepticism. (All emphases added.)

Kurt Andersen's 11/20/05 New York magazine Imperial City column, was headlined Delirious New York: Our long architectural snooze is over, thanks to neomodernist mania and the arrival—finally—of Gehry. Brooklyn should embrace him. It sure sounded like Ratner was with the program:
Until now, most of Ratner’s buildings have ranged from the uninspired to the bad, like his shopping center across from the Atlantic Yards. Even he admits the Atlantic Center mall is “not up to snuff. Philip Johnson did a first design, but I made a decision not to use him. I have to blame myself. I’ve been talking for ten years about trying to use ‘design architects’ instead of ‘developer architects.’ ”

Why does he think New York was so bereft of exciting large-scale architecture for so long? “It’s something I ponder a lot,” he says. “So mediocre.” ...

Given Ratner’s track record, I asked Gehry if at first he mistrusted Ratner’s professed new dedication to quality and innovation. “Yeah. Yes, I did.” And how did he get over his skepticism? “I’m still getting over it,” he says, although so far, “the budget busts have not been architectural ones. He’s always voted with me on the side of the architectural. He runs into roadblocks sometimes in his company, but it has not been cataclysmic.”

Ratner isn’t spending 15 percent extra on these new buildings simply because he wants to underwrite cool design. He understands that in Brooklyn, just as his quotas of apartments for poor people and construction jobs for women and minorities were ways of winning over key constituencies, hiring Gehry was politics by other means, sure to please the city’s BAM-loving chattering class. “The spirit of what you say,” Ratner agrees when I posit this theory, “is accurate.”

In the Times, a "conversion"

In Nicolai Ouroussoff's 7/5/05 New York Times essay, headlined Seeking First to Reinvent the Sports Arena, and Then Brooklyn, the critic suggested that the developer had undergone a "conversion":
By comparison, Forest City Ratner Companies, a relatively conventional developer known for building Brooklyn's unremarkable MetroTech complex, has seemingly undergone an architectural conversion, entrusting a 7.8-million-square-foot project to a single architectural talent who is known for creating unorthodox designs.

It seems like a gutsy decision. But Bruce C. Ratner, the company's chief executive and the development partner of The New York Times in building the newspaper's new headquarters in Manhattan, has apparently realized that the tired old models are no longer a guarantee of cultural or financial success. He seems willing, within limits, to allow Mr. Gehry the freedom to play with new ideas.

In Ouroussoff's 6/4/06 Times essay, Skyline for Sale, the critic assessed the embrace of top-name architects by bottom-line developers and came away somewhat skeptical, though he again used the term "conversion":
If Bruce Ratner's recent embrace of high-end architecture has some New Yorkers rolling their eyes, he can't be all that surprised. Not so long ago this developer's most visible cultural contribution to the city was a few kitschy theaters on 42nd Street. In Brooklyn he is known mainly as the creator of Metrotech, a complex of overblown yet banal office towers that seem to crush the life out of the city around it.

And even Mr. Ratner admits that, as a Brooklyn-based commercial builder, he once ranked at the bottom of the city's architectural food chain.

But in recent years he has sought vigorously to polish that image. His conversion began six years ago, when he joined The New York Times Company in selecting Renzo Piano — an architect known for the refinement of his buildings — to design a new Times headquarters in Midtown Manhattan. And it gained traction when Mr. Ratner handed Frank Gehry — whose celebrity has reached the point where he now has a signature jewelry line at Tiffany — the commissions for Atlantic Yards...

Now, our expectations are lowered.

Congestion pricing failure may delay BRT; Flatbush route not yet on the agenda

The failure of congestion pricing threw a bit of a wrench in the city's plans for Bus Rapid Transit (BRT), suggested as one solution to congestion on Flatbush Avenue, but now apparently several years away.

Though Flatbush is an obvious candidate for such service--which would have a dedicated express lane, fewer stops, offsite payment and "honor system" entrance (subject to random check), staggered stoplights, and back boarding, according to the city's pilot in the Bronx--another obvious candidate, Nostrand Avenue, was selected in 2006 for one-per-borough pilot project. It looks to be about four years away, however.

(Here's the Metropolitan Transportation Authority's site on the service, though the map for a proposed Flatbush Avenue route, at right, is no longer available.)

The PlaNYC 2030 Progress Report issued last week explains the fate of BRT, now dubbed Special Bus Service (SBS):
The first SBS corridor, on Fordham Road in the Bronx, is set to begin service in June 2008. The remaining four SBS services had been planned to start over the next few years, but relied on federal funds contingent on congestion pricing. The City is now pursuing additional funding sources, but the SBS projects may be delayed by the loss of Federal funds.

(Nearly one-third of the $354 million in federal funds was to go to BRT, according to an essay last week in Gotham Gazette. Map from MTA's Project Update.)

A PlaNYC "scorecard" clarifies that the other four SBS services are planned to be introduced by 2011. That's likely too late to start up a Flatbush Avenue version by 2010, the unreliable official target date for opening the Atlantic Yards arena, or even 2011, which I consider the likely best-case scenario.

Brooklyn BRT in 2012?

In fact, the Metropolitan Transportation Authority contradicts the PlaNYC document, estimating on its SBS FAQ page that the Nostrand Avenue route would be implemented in 2012. Though that's subject to change, it's a good bet that a Flatbush Avenue route would be at least a year after that.

Would that be in time for an AY arena? Then again, developer Forest City Ratner has six years--after the close of litigation and the transfer of property via eminent domain--to build the arena without penalty.

(Slide at right and two similar slides below from Re-imagining Bus Service in New York: Select Bus Service and the Better Bus Program, by Janette Sadik- Khan, Commissioner, NYC DOT and Howard H. Roberts, Jr., President, MTA NYC.)

Funding available?

Is there money? The scorecard explains:
This program was previously funded through the Urban Partnership Agreement (UPA) between the City and the U.S. Department of Transportation. Since these funds were contingent on approval of congestion pricing by the State Legislature before April 7 2007, DOT and the MTA are now pursuing federal New Starts funding to implement these corridors.

Is it really rapid?

What's BRT? The Tri-State Transportation Campaign has a comprehensive web site that covers its implementation in several cities. Note that Curitiba, Brazil, and Bogotá, Colombia are among the leaders in this effort.

The city's use of the term Special Bus Service, which may be more accurate than Bus Rapid Transit, has been targeted by some critics; blogger Cap'n Transit points out that "the primary factor is right-of-way, and the single most important feature is physical separation of the right-of-way."

Also, the city and MTA are not yet ready to use buses with extra doors specifically designed for BRT.

BRT for Flatbush

Several commentators on the Atlantic Yards Draft Environmental Impact Statement, including project supporters like Brooklyn Borough President Marty Markowitz, advocated that Bus Rapid Transit (BRT) be implemented along Flatbush Avenue to help cope with the inevitable crowding further exacerbated by the Atlantic Yards project.

The Empire State Development Corporation, in response, pointed out that Nostrand Avenue, not Flatbush, had been selected for the Brooklyn pilot:
Though studied, there are no present plans to implement a pilot bus rapid transit program along Flatbush Avenue. The proposed project, including the proposed lay-by lanes adjacent to the arena block, is not expected to preclude the installation of bus rapid transit lanes or stops should they be considered in the future….

More routes needed

In a Gotham Gazette essay last week headlined Bridging New York's Transit Gap, Joan Byron of the Pratt Center for Community Development described an expanded version of BRT--including a Flatbush Avenue route--as an equity issue, helping poorer New Yorkers in areas not served by subways to lessen their lengthy commutes to work:
BRT will create an efficient no-transfer option for hundreds of thousands of people whose mobility is now limited to the radius a conventional bus can cover at a speed of 7.9 miles per hour.
(Click to enlarge map)

She adds:
Meanwhile, a small but growing number of transit advocates and riders who know what BRT is are clamoring for more routes. COMMUTE! (Communities United for Transportation Equity), a coalition of community groups coordinated by the Pratt Center for Community Development, wants the BRT routes to cross bridges and connect the boroughs, making buses a more serious complement to the subway system.

She concludes:
With both the one-time shot of federal funding and the projected $500 million per year in net revenues from congestion pricing off the table for the moment, BRT may be more important than ever. The MTA Capital Plan has, in words of Straphangers Campaign spokesman Gene Russianoff, "more hole than plan," with less than $12 billion of a five-year, $29 billion shopping list accounted for. As the rail and subway projects envisioned in that plan recede into the future, BRT makes more sense than ever. It will not prevent us from building light rail or subways in the future, but for now it makes intelligent use of the infrastructure we already have - our streets.

Indeed, COMMUTE! advocates a much more aggressive program, calling BRT "An Affordable Solution for Transit-Starved Communities":
Launch as many BRT routes as possible, as quickly as possible. Five routes are not enough, and neighborhoods with high concentrations of people with long commutes should be the priority for BRT.

And here's a critique of the COMMUTE! plan, from the blogger Cap'n Transit.

The PlaNYC 2030 housing update and the contradictions of AY

When PlaNYC 2030 was announced last April, I pointed out how Atlantic Yards was conspicuously absent as an example of how to build new housing, even though the plan promotes the identification of underutilized areas across the city that are well-served by transit and the exploration of opportunities to create new land by decking over rail yards, rail lines and highways.

Given that the project remains high on the mayoral agenda, the omission was curious, I noted--though I'd add today that there is a built-in excuse; as a state project, the city can claim that it has no power over the rezoning.

Gaps in the Progress Report

The PlaNYC 2030 Progress Report issued last week also understandably leaves Atlantic Yards off the maps of city-initiated rezonings (above) and rezonings with inclusionary zoning (right).

But both maps deserve some footnotes. The map at top shows a significant segment of west-central Brooklyn rezoned. The lighter-colored and irregular piece of that segment is the Downtown Brooklyn rezoning. Atlantic Yards, not a rezoning but a state override of city zoning, would be to the southeast.

Also note the contrast between the two maps; absent from the second map are rezonings that, had the city been more wise, would have featured inclusionary zoning, which trades additional square footage for affordable housing. Given that the rezonings in Downtown Brooklyn and along Fourth Avenue in central Park Slope gave significant value to property owners who could then build much bigger, it was a reasonable tradeoff.

In the case of Downtown Brooklyn, most observers and advocacy groups seem to have dropped the ball, as the New York Observer pointed out in May 2006. In the case of Park Slope, affordable housing advocates like City Council Member Bill de Blasio made the case for inclusionary zoning, but city officials resisted.

Expanding the supply

Atlantic Yards, though not a rezoning, would seem a parallel with two elements of the city's plan: rezonings in areas near transit and construction on public land. The progress report states:
Rezonings in transit-oriented areas are expanding potential supply as well; rezonings adopted since 2005 could result in more than 36,000 new housing units, including 5,200 in the Jamaica rezoning alone and anticipated rezonings could facilitate over 35,000 new units.

This last fiscal year, we started almost 1,700 units of affordable housing on public land.

This provides some context for Atlantic Yards, with its projected 6430 units, including 2250 rentals, plus perhaps 600-1000 affordable for-sale units. AY, which would include more than a half-million square feet of office space (the equivalent, perhaps, of another 500 apartments) would be over approximately [corrected] six (large) blocks.

The Jamaica rezoning, which includes both downzonings to preserve scale and upzonings to increase development rights, would produce 5200 new units and 3 million square feet of commercial space (the equivalent, perhaps, of another 3000 units) over 368 blocks.

In other words, AY would be packing a lot in.

The contradictions of AY

That's why veteran community planner Ron Shiffman, founding director of what is now the Pratt Center for Community Development (and a board member of Develop Don't Destroy Brooklyn) might have been seen to contradict himself when speaking at a discussion last Wednesday on PlaNYC hosted by the NY Metro Chapter of the American Planning Association. (Here's more on the panel.)

On the one hand, he supports "spatial equity," so that low- and moderate-income people have places to live throughout the city and also transit-oriented development, density near public transportation. Both are arguments for Atlantic Yards.

On the other hand, he pointed out, affordable housing should be based not on regional median income but local median income, so it's not out of the reach of neighborhood residents. (That criticism applies not just to Atlantic Yards but to all affordable housing developments.)

He also argued that inclusionary zoning should be mandatory, not voluntary, which removes the possibility of "zoning for sale," an accusation lodged against AY, which is essentially a privately-negotiated (by developer Forest City Ratner and ACORN) affordable housing bonus.

He further contended that "inclusionary zoning should not be a wedge issued used by a developer," a reference to how Atlantic Yards has polarized groups in Brooklyn.

Finally, he pointed out how he and others "fought desperately" against the "suburbanization of our communities," the construction of single-family homes, some detached, in places like the South Bronx and East New York. Those were efforts to establish a working-class presence in formerly devastated areas, and they worked, but they didn't allow room for growth that the transit infrastructure could support.

"Today, said Shiffman, "we see proposals that far exceed" the social, cultural, and physical infrastructure. "We need to increase density, but with a sense of the carrying capacity," so that communities are livable. Though he didn't say the words "Atlantic Yards," that's been his critique of the project.

PlaNYC gets praise from planners, but momentum must be sustained

While an April 14 panel consisting of community representatives and planners offered mild praise for and much skepticism toward Mayor Mike Bloomberg’s PlaNYC 2030 sustainability initiative, an April 23 discussion, sponsored by the NY Metro Chapter of the American Planning Association, was far more positive, though participants suggested several areas for improvement.

NY Metro Chapter President Ethel Sheffer called it “this terrific initiative” and, indeed, there was generally positive reaction. The city released a PlaNYC progress report the day before. The press release stated 117 of 127 initiatives (93%) are in progress, and about 70 percent of PlaNYC initiatives can be accomplished by the mayoral administration, while the request require cooperation from other levels of government.

“From turning our yellow and black cabs to green, beginning to plan the 8 regional parks that were never finished from the Robert Moses era, and planting more than 50,000 trees as part of our MillionTreesNYC effort, New York City is making big strides in becoming one of the greenest cities in the World," Bloomberg said in the press release.

Other highlights include:

• a new landscaping requirement for commercial parking lots
• 60 miles of bicycle lanes and roughly 800 new bicycle parking rack
• an Executive Order codifying the Bloomberg Administration’s goal to reduce its energy consumption by 30 percent by 2017
• an RFP for the installation of 2 megawatts of solar capacity on City-owned buildings
• the incorporation of green building concepts, such as reflective roofs, into the new Construction Code.

Some critique

In a report issued last week, Building a Greener Future: A Progress Report on New York City’s Sustainability Initiatives, the New York League of Conservation Voters Education Fund praised the mayor but suggested that, “despite the significant progress made in the last year, much still needs to be done.”

It offered six priorities:

• Approve legislation that codifies the Office of Long-Term Planning and Sustainability in the city’s Administrative Code.
• Work with the City Council to amend the City Charter to require the City to spend an amount equal to 10 percent of its energy expenses in energy-saving measures.
• Create an office to assist building owners in converting to green technologies.
• Include a measurement of every agency’s energy consumption and savings in the Mayor’s Management Report.
• Fully staff the proposed Office of Environmental Remediation and create a unified planning infrastructure to guide the development of new open space projects.
• Create a variable-price parking program that would increase the price for street parking in the Manhattan Central Business District during peak hours, begin a comprehensive study of the parking requirements in the Zoning Resolution and increase city funding for the MTA.

At the panel

At the panel, describing the city’s progress, Ariella Maron, Deputy Director, Office of Long-term Planning and Sustainability, NYC Mayor's Office of Operations, was particularly enthusiastic about several measures, including rules that all new taxis be hybrid by 2012. “It’s looked in law, it’s happening, it’s fantastic.” Also, she said, “it’s amazing” how city agencies have embraced various initiatives.

While community representatives expressed unease at the earlier panel about the longevity of some initiatives, Maron said, “We’re working very hard to codify as much as possible,” including a bill that puts sustainable planning into law.

Beyond the specific governmental initiatives, Maron noted, individual New Yorkers can take several steps themselves, summarized on the GreeNYC page, including shifting to online bills, shopping with cloth bags rather than plastic, and unplugging electrical outlets.

Housing issues

Despite Bloomberg’s efforts, the housing shortage is going to increase, warned Jerilyn Perine, Executive Director, Citizens Housing and Planning Council. She described how city investment in the 1980s and 1990s “helped build a marketplace” and attract private capital, but most new construction was unaffordable to the average New Yorker. Less than 25% of available apartments are affordable to New Yorkers at the median income

More singles live in New York, and more life with fellow adults, thus leading to the now-typical post-college mutliple-roommate situation, where clusters of unrelated people, each with their own income, compete with nuclear families for larger apartments.

While 8% of households were doubled up with families or friends in 1996, the number grew to 10% by 2005. Worse, more than 29% of households paid 50% or more of their income in rent in 2005.

Perine suggested that one solution might be to rethink density, not in terms of the size of buildings--which is what generates neighborhood opposition--but the interior design.

“We live at a palatial standard” indoors compared to most of the world, she said. While that may not be true for those packed into studios in Manhattan, she noted that zoning requirements even for supportive housing--where single adults could live in one room--require 600 square feet for apartment.

While inclusionary zoning can deliver more housing, she said, it’s unrealistic to think the city of New York can provide enough units on its own; the federal government needs to help.

Praise and caution

Veteran community planner Ron Shiffman, founder of what is now the Pratt Center for Community Development, He agreed with Perine: “We desperately need to get the federal government back in the business of building housing.”

Shiffman said he applauded the city and mayor for the plan, a “very bold vision... that needs a great deal of support.” That was the context, he said, with which his criticisms should be seen.

He said the city had to “build the base within communities” to support the plan. He said the plan didn’t engage equity and social justice, such as access to affordable housing and transportation. (His comments about housing could be seen as supportive of but ultimately critical of projects like Atlantic Yards.)

He said the city needs to be part of the “second industrial revolution,” producing green products within its borders.

Mobilizing the public

Marcia Bystryn, Executive Director of the NY League of Conservation Voters, saluted Bloomberg for “the precision and rigor with which he has proceeded.” While others have expressed dismay that the sustainability plan was linked to economic development, warning of the city’s sympathy to developers, Bystryn suggested that it rather recognized the centrality of the issue.

"It’s critical” to mobilize the public so sustainability is part of the agenda for the 2009 mayoral election, she said. Even without congestion pricing, she said the city could do certain things on its own, such as revising parking policy (an issue I’ll look at separately).

Where’s the money?

Without funds from congestion pricing and federal aid, there’s a significant lack of funds for infrastructure; Bystryn cited a “chasm” between available funding and the MTA’s capital plan.

Shiffman suggested a solution for the city’s loss in revenues: reinstituting the stock transfer tax, which New York City adopted in 1966 but phased out in 1978. Here’s an IBO report that offers several cautions, at least regarding the version as proposed in 2003. Here’s a more recent article making the case.

Flashback: in 2005, the Times reported project completion by 2011

Remember this front-page New York Times article?

The article was flawed for all sorts of reasons, notably the claim that the arena was instantly gaining a skyline. (See the skyline announced in December 2003 here.) Instead, revised designs were being released, exclusively to the Times.

But a second look shows the real whopper below.

Well, 2008-9 for the arena is of course way off. At the time, it was highly unlikely though not completely implausible, assuming a smooth environmental review process and no lawsuits.

2011: a fantasy

But could the entire project have been completed by 2011? That's ridiculous, given that the developer claimed when Atlantic Yards was announced in 2003 that it would take ten years to build.

(That statement was in a Project Overview handed out to the press; however, a different Times reporter covered that press conference and the timetable was not cited in the Times's 12/11/03 coverage.)

Ten years, of course, was the "anticipated" time frame in the General Project Plan approved in 2006 by the Empire State Development Corporation, with Phase 1 completed by 2010. Of course, we now know (though the Times hasn't reported it), that the developer has 6+ years to build the arena, 12+ years for Phase 1, and an indeterminate time for Phase 2.

Correction needed

Maybe the Times quoted Stuckey accurately, but he was blowing smoke. Or maybe the Times misquoted him in some way

Either way, the Times should both correct the record and ensure that those perusing the newspaper archive understand that 2011 was never a plausible target.

Tougher on the Times?

A reader asked me if I was harder on the Times than other journalistic outlets that make factual errors in their AY coverage. The answer is yes. The Times is the "Paper of Record," or at least is/was perceived to be, and it's where researchers typically search. In the case of Atlantic Yards, the Times certainly shouldn't be the only source consulted.

De Blasio claims AY would have 3000 low-income units

In an interview in the Spring issue of the Park Slope Reader, City Council Member Bill de Blasio, who's running for Borough President, shows he hasn't improved his due diligence regarding Atlantic Yards.

Notably--unless he was misquoted--he claimed that the project would include 3000 low-income housing units, a significant overstatement.

Actually, the plan is to include 900 low-income rental units--at 30-50% of AMI (Area Median Income)--among 2250 affordable rentals, and 600 to 1000 for-sale affordable units, of which a "majority... will be sold to families in the upper affordable income tiers," according to the Housing Memorandum of Understanding Forest City Ratner signed with ACORN. That means households with six-figure incomes, perhaps needing a boost in New York, but hardly low-income.There are no deadlines for the for-sale units, nor penalties for noncompliance, according to the State Funding Agreement.

Also note that the AMI, $70,900 for a four-person household, is based on a region that includes suburban counties. (The Draft Environmental Impact Statement for the Atlantic Yards project, in Chapter 4 (p. 34), cites the median household income for Brooklyn as $32,135 and for the city as $38,293. Those statistics come from the 2000 U.S. Census and thus are somewhat outdated--and also refer to households with an average household size of 2.6 people-- but they still suggest that Brooklyn's median income is significantly less than the regional AMI.)

The Q&A

Q. You’ve been a supporter of the Atlantic Yards project. Not all local residents agree with you on this. How do you see the evolution of this project in the future?

A. There’s still a lot of work to be done. I’ve supported Atlantic Yards because it will provide over 3000 units of affordable housing to low-income residents and it will bring more local jobs to the neighborhood. But I’m not happy about many aspects of the project as it exists today. Many of the buildings are too tall and can be lower; the scale of many of the buildings simply doesn’t fit in with the surrounding neighborhoods. A lot of mass transit issues still haven’t been addressed and no specifics have been offered: there will be a huge increase in traffic plus we’ll need additional bus lanes and more frequent subway service. Also, I’m not happy at the way Forest City Ratner has shut out the surrounding communities from the decision-making process. I feel that the Borough President office can have an impact on these issues, and that is one reason why I am running for Borough President.

If the buildings are too tall, the project would likely have to shrink, which would lessen the amount of affordable housing.

(Note that de Blasio has become more vocal in his criticism lately, and will be speaking at the "Time Out" rally next Saturday.)

Bonding delays

And, as de Blasio should know, affordable housing is dependent on a a limited pool of tax-exempt bonds. So a smaller AY or a different project (a la the UNITY plan concentrated on the Vanderbilt Yard) might not mean as much affordable housing at their specific sites--but the funding might be used elsewhere to build housing faster.

One question de Blasio should be asking--and asking himself--is why the project was approved with an "anticipated" ten-year buildout even though the lack of bonding capacity meant the schedule was highly unrealistic.

In other words, 900 low-income units over ten years means 90 units a year; over 20 years, that's 45 units a year, and over 30 years, that's 30 units a year. That's a far cry from 3000.

Other comments on development

Also, de Blasio called "the high-rise development on Fourth Avenue... a huge disappointment" because of the lack of affordable housing he fought for--a lesson the city has since learned, but too late for Park Slope. He did his due diligence on that issue.

On the other hand, he suggested that the office of the Borough President can "intervene case by case" to "negotiate with the developers and make sure their projects truly benefit the community."

Maybe, but wouldn't it be better to set some ground rules at the start?

The importance of context

The potential Borough President seems to be a supporter of context:
We can make changes in land use. With some buildings- and I am thinking about the apartment house on Warren Street and Fourth Avenue that my daughter and I walked by the other day- the architect did a good job; he made it appear that the building is a part of the existing neighborhood.

I am amazed that many developers are not aware of the need to make their buildings fit in to the neighborhood. I also think it’s good business, because attractive buildings promote neighborhood renewal. This, in turn, increases property values.

Frank Gehry's plan for Atlantic Yards (view from Dean Street east of Sixth Avenue, right) is not exactly about context. Supporters of this and other large developments might point out that a slavish adherence to context can be paralyzing.

How to mediate all this? It's not simple, but overblown claims about affordable housing shouldn't trump analysis.

All in the timing: "when" but not "if," says FCR (but not on AY.com)

From the FAQ page at the Atlantic Yards web site:

Obviously, ground hasn't been broken. And the plan, at least that passed by the Empire State Development Corporation (ESDC), may have been to phase construction over ten years, but it was hardly realistic. Now it's an impossibility, and the ESDC gives the developer a long leash. So the FAQ needs an update.

Promises of "when," not "if"

From a front-page Wall Street Journal article yesterday headlined Economy, Credit Woes Foil Cities' Big Projects:

One project being watched closely is Atlantic Yards, a $4 billion development that Forest City Ratner Cos. is building on 22 acres in Brooklyn, N.Y. After a number of court battles, the developer plans to finally begin construction on a new arena for the New Jersey Nets basketball team by the end of this year.

However, the schedule for its planned office tower, called Miss Brooklyn, likely be will pushed back until an anchor tenant is signed given the current market conditions, says Loren Riegelhaupt, a Forest City spokesman. He stresses that the entire project eventually will be built. "It's not a question of if, but when."

Well, the plan may be to break ground this year, but how can he be sure? As to whether the entire project will be built, well, there's no guarantee that housing subsidies will be available.

More importantly, the governmental authorities don't require the project to be built as approved; the State Funding Agreement includes a City Purpose Covenant that allows for the amendment of the General Project Plan and contemplates its abandonment for a smaller project. Maybe that's why Frank Gehry is laying off architects, as the Los Angeles Times reports on its blog.

Rally for AY "time out" to be held Saturday, May 3

No More Demolitions!
No More Changes to Infrastructure!
No More Subsidies!
No More Displacement of Residents and Businesses!

The "Atlantic Yards stall" has brought groups representing different flavors of project criticism and opposition together for a rally at 2 pm on Saturday, May 3, with a range of local political officials confirmed as attendees. The location is 752 Pacific Street near Carlton Avenue in the AY footprint, a block planned to hold "interim surface parking" that could last indefinitely. (The Brooklyn Paper broke the news, though the lead of the article says Sunday rather than Saturday and stresses stopping demolitions.)

The stated purpose--asking Gov. David Paterson for a "time out"--is certainly milder than the full agenda of Council of Brooklyn Neighborhoods (CBN) and Develop Don’t Destroy Brooklyn (DDDB). Indeed, DDDB restates its opposition to the project in its rally announcement.

What does the statement that "Brooklyn needs a new plan and community involvement" mean? It could mean the UNITY plan, which DDDB and CBN support, but it also could be a restatement of the position of more moderate coalition BrooklynSpeaks, which has taken a "mend it, don't end it" posture toward AY and has avoided joining any lawsuits.

BrooklynSpeaks, which has the expertise of the Municipal Art Society behind it, has proposed a new governance structure to oversee the project and has gained the support of several local elected officials who have expressed concerns about the project but have avoided standing with DDDB.

CBN and DDDB are petitioners in the pending appeal of the lawsuit--dismissed at the trial court level--challenging the state's environmental review. (DDDB has raised money for this and the eminent domain lawsuit, now on a longshot effort to get the Supreme Court to hear it.)

Potential impact

It's unlikely that Paterson would intervene regarding demolitions; after all, judges have previously been unwilling to intervene when FCR demolishes properties it already owns. As for displacement, that would mostly be a consequence of eminent domain--not yet exercised, but certainly on the Empire State Development Corporation's agenda. Will Paterson revisit his 2005 call for a moratorium on eminent domain?

If project completion requires more subsidies, as the developer asserts, then that may be the most critical issue at the rally. Does the developer deserve more subsidies to deliver promised public benefits on a specific timetable? Or was the promised ten-year buildout unrealistic from the start, as suggested by the long leash given for the arena and Phase I, with no timetable for Phase II? That's an issue, perhaps, for the upcoming Assembly hearing on megaprojects, which could look more carefully at plans and promises behind AY.

(Note that that FCR is in the middle of demolishing the Ward Bakery, a building many wanted to save, near the site of the rally, to create space for that "interim surface parking." It has taken no steps to tear down 24 Sixth Avenue, once filled with handsome condos and now being used for offices and temporary apartments, though it would be needed for the arena block. Should the project fail, the units could easily be resold.)

Elected officials

Two City Council Members who've generally supported the project, David Yassky and Bill de Blasio (both candidates for higher office), have ramped up their critical rhetoric and joined their Council Member colleague, project opponent Letitia James, in asking Paterson for a similar time out.

DDDB says several other elected officials have confirmed attendance: State Senator Velmanette Montgomery, State Assemblywoman Joan Millman, State Assemblyman Jim Brennan, State Assemblyman Hakeem Jeffries, the three Council Members mentioned above, and Council Member (and maverick mayoral candidate) Tony Avella.

While that group basically contains the local elected officials most concerned about the project rather than a huge base, they haven't previously come together for such a rally.

(Note that the rally location is outside a building owned by Henry Weinstein, a plaintiff in the eminent domain case and a party in a suit, so far successful, against his tenant Shaya Boymelgreen, who then assigned leases to Forest City Ratner.)

Arena subway access without the Urban Room? ESDC says it's OK

I suggested yesterday that, unless certain parts of the flagship tower Miss Brooklyn (aka Building 1) are completed, the Atlantic Yards arena would open without the Urban Room, the glass-clad atrium that would serve as a combination building lobby, arena entrance, subway entrance, retail/restaurant space, and public gathering space, not to mention surfaces for signage and lighting.

On second thought, it looks impossible that the Urban Room could be completed separately from Miss Brooklyn. And the Empire State Development Corporation (ESDC), while touting the Urban Room as "a significant public amenity" in the General Project Plan it approved 12/8/06, some ten months later, in the State Funding Agreement that recently surfaced, changed its tune.

The agreement requires developer Forest City Ratner only to provide "subway station access" to the arena, not the Urban Room "destination" (a term from the Final Environmental Impact Statement, or FEIS) that wowed some architecture critics.

The ESDC states, in the Project Description chapter of the FEIS: The glass-enclosed Urban Room would be located at the base of [Miss Brooklyn].

New York Times architecture critic Herbert Muschamp, in his 12/11/03 rave review, embraced the concept:
There is also an "urban room," a soaring Piranesian space, which provides access to the stadium and a grand lobby for the tallest of the office towers.

(Images from Atlantic Yards web site.)

Arena without Urban Room

Developer Forest City Ratner now intends to open a residential building along with the arena, as reported yesterday. A look at the renderings confirms that it would be very difficult to build just the Urban Room. New York Times architecture critic Nicolai Ouroussoff, in his 3/21/08 lament about changes in the project, leaving just the arena as a priority, observed:
The atrium, once a vital public space, will be reduced to a barren strip of pavement.

In this week's Brooklyn Paper, project critic (especially on security issues) Alan Rosner points out in a letter that if the Urban Room is to be built without Miss Brooklyn, "Bruce Ratner will have some major redesign costs." It would be less costly, Rosner writes--and far more likely, I conclude--to wait until the tower is built.

However, Rosner suggests that, in the absence of the Urban Room, there won't be a place for crowds of pedestrians exiting from the new subway station: "The silence suggests that neither the ESDC nor Ratner are concerned." Why the ESDC agreed to this might be aired at an upcoming hearing of an Assembly oversight committee. (The rest of Phase I is supposed to be built within dozen years, which means that the Urban Room should ultimately be built.)

Initial promise

An initial fact sheet about the project promised both that Miss Brooklyn would not block the Williamsburgh Savings Bank--not true, it turned out--and that the Urban Room would be the entrance to the transit hub:
The northernmost building on the site, an office building, will be set back slightly from the intersection of Atlantic and Flatbush Avenues, to maintain the view corridor to the Williamsburg Bank building. The point of this triangle will become part of an “urban room,” a new exterior space formed by raising the office building on pilotis (a term coined by famed architect Le Corbusier, pilotis are columnar structures designed to raise the mass of a building off the ground).
Travelers will enter or exit the transportation hub as well as the Arena and the northernmost office building through the urban room, which will also contain retail shops.

Design Guidelines

Part 1 of the Design Guidelines, part of the ESDC's General Project Plan (GPP), indicates that one of the principal entrances to Building 1, including the office component and hotel component would be via the Urban Room. (The hotel component appears to be shelved for now.)

Part 3 of the guidelines provides an architectural drawing (right), which shows the Urban Room integrally connected to Building 1.

Much praise

The ESDC, in its Final Scope of Analysis, a prelude to the environmental review, called it a "grand civic space."

The ESDC's FEIS, in the Project Description chapter, offers an impressive portrait:
A prominent feature of the pedestrian experience on the arena block is the “Urban Room,” which would be located at the southeast corner of Flatbush Avenue and Atlantic Avenue at the base of Building 1 (see Figure 1-6). The “Urban Room,” would consist of a large, at least 10,000-sf publicly accessible atrium that would serve as a dramatic gateway to the arena and provide a place for people to congregate. The Urban Room would serve multiple purposes depending on the time of day and the activities taking place. On weekday mornings, the Urban Room would serve as the principal access to mass transit for the neighborhoods to the south, east, and west of Atlantic Avenue. On evenings and weekends (and when there are no arena events), the Urban Room would be activated by the restaurant on the second level mezzanine and the hotel uses. Thus, this glass-enclosed space is expected to serve as an entrance to the office space and hotel in Building 1, the restaurant and cafe, the arena (its ticket booths would be located here), and a new access point to the subway via an underground connection. There would be approximately 10,000 square feet of space that would be available for the public. The Urban Room would serve as its own destination when programmed with small concerts, cultural events, art shows, and readings that would be open to the public. Within the Urban Room, a café would be centrally located on the street level for ease of access for pedestrians going to and from the subway and the street during both event and non-event periods. The second level mezzanine of the Urban Room would be accessed externally by a grand stoop at the corner of Atlantic and Flatbush Avenues or internally by a stair and an elevator.

(Figure 1-6 is the second rendering above)

State Funding Agreement

Part 33 of the State Funding Agreement (right) simply states: Developer shall be required to provide reasonable assurances... that the new subway station access that will adjoin the Arena will be completed an operational at the time the Arena is opened for operation.

That says nothing about the Urban Room. So, for the first year(s) of arena operations, maybe there would be a temporary above-ground facility--an Urban Shed?--linking to subway access.

That's not ideal for Forest City Ratner; the Urban Room would be a billboard for advertising, as well. However, the sponsorship deals for the Barclays Center, coupled with the current major losses at the Izod Center in New Jersey, make a Nets move to Brooklyn far more fiscally important to the developer than the presence or absence of the Urban Room.

GPP on subway connection

The ESDC's GPP states that the project would include a "subway connection on the south side of Atlantic Avenue... with sufficient capacity to accommodate fans entering or leaving and event at the Arena."


The GPP also praises the Urban Room, calling it
a significant public amenity comprised of a large, glass-enclosed public space, providing access to the subway station, the Arena and Atlantic and Flatbush Avenues. This space would accommodate the major flows of people to and from the subway system during the day and night, serve as a direct subway entrance to the Arena and allow for a variety of public uses and programmed events throughout the year.... Building 1 would provide a significant new subway entrance from the Urban Room and the street that would directly serve the Arena, commercial office space, hotel, and new residential uses.

But without Miss Brooklyn, it looks like there's no room for the Urban Room.

Brodsky seeks AY timetable, cost-benefit analysis in report on megaprojects

What might be the impact of the law (details from the New York Observer) proposed by Assemblyman Richard Brodsky that would require the Empire State Development Corporation (ESDC) to report within 45 days on the status of several megaprojects, including Atlantic Yards.

If passed, the law would require not merely a status report, but also would require a cost-benefit analysis that has so far not been conducted. It would require the ESDC to detail the full spectrum of public "incentives, benefits, subsidies, and revenues," the projected economic impact on the city, state, and metropolitan area, "and a comparison of expected benefits with anticipated costs."

That could be a watershed. The ESDC has produced a lengthy Final Environmental Impact Statement (see the last pages of the Socioeconomics chapter), as well as a General Project Plan, both of which estimate new revenues, but provide scant details on the totality of public subsidies and public costs. (The Independent Budget Office came the closest to estimating the total impact of the project, but shied away from a full study.)

It would be astounding if the ESDC produced a full cost-benefit analysis within 45 days. More likely the agency would supply an updated version of previously compiled documents.

Hearing coming

Even without the passage of the law, Brodsky pledged a hearing, saying, according to EmpireStateNews.Net, that "Our economic future is tied to our transportation system, and our first economic and social priority must be the funding of the MTA Capital Plan... The Governor has asked Richard Ravitch to Chair a gubernatorial Commission to address these issues. It is clear we are coming to a crisis. That crisis can be solved, but only with clear information and a willingness to set priorities, and make difficult decisions. The Committee will shortly convene a public hearing to inquire into the capital plan and other issues, in addition to awaiting the Report."

Of course, given Brodsky's role as a leader in killing congestion pricing, which would provided significant revenues to the MTA, he undoubtedly will face criticism for selective concern.

Then again, he has long taken a critical view of the ESDC; he chairs the Assembly committee that oversees state authorities and corporations and, shortly after the ESDC's passage of the Atlantic Yards project in December 2006 but before the vote of the Public Authorities Control Board, asked some (but, in retrospect, clearly too few) tough questions of the ESDC at a hearing.

Legislative rationale

The bill states:
The legislature finds that there are in the city of New York many large capital projects to be financed in whole or in part with public funds or to be supported by tax and other public incentives and which are crucial to the economic and cultural interests of such city and the state of New York as a whole, and which are at some stage of proposal, planning or implementation. The legislature further finds that it important that a full disclosure be made of the details of such projects, their projected costs to the city and state and to public benefit corporations, the projected benefits, the reasons why some of them have been delayed and why some of the proposals have been modified. Accordingly, it is critical that the New York state urban development corporation, also known as the Empire State Development Corporation, provide a prompt report to the legislature on such projects so the legislature can provide the necessary policy determinations and establish appropriate priorities so that necessary projects can proceed.

(Emphasis added)

Could "appropriate priorities" mean additional subsidies? Or a pledge for no more subsidies? Or a nudge to the head of the line for scarce affordable housing bonds?

Comprehensive report

The bill concludes:
The chairman shall prepare and deliver to the Governor, the temporary president and the minority leader of the senate and the speaker and the minority leader of the assembly not later than 45 days after the effective date of this act a comprehensive report on each of the projects individually and as they interact with and have any effect on the other. In preparing such report, the chairman shall consult with private developers, and government officials and agencies involved with each project, including without limitation, the port authority of New York and New Jersey, the lower Manhattan development corporation, the metropolitan transportation authority, the office of the mayor of the city of New York, the city council of the city of New York, and the governor of the state of New York, and other person or institution deemed appropriate. All such officials and agencies are hereby authorized and directed to consult with and assist the chairman in the preparation of such report.

Such report shall discuss all aspects of the progress of each project relating to planning, financing, permitting, contracting, constructing, and occupying such project, with comments on the current situation relating to organizational, legal, financial, economic and construction status and prospects, and the impact of such project, if any, on the capital needs of the Metropolitan Transportation Authority, with reference to differing opinions from various stakeholders and parties involved to the extent that such opinions exist. The report shall make recommendations with regard to the goals of each project and the recommended methods to achieve such goals. It shall also present an analysis of the potential financing of each project, including incentives, benefits, subsidies, and revenues to be provided by any governmental unit or public benefit corporation and the economic impact that the project is expected to have on the city of New York, the state of New York, and the metropolitan area centered in the city of New York, and a comparison of expected benefits with anticipated costs.

It is unclear to me that such a report would require, for example, the ESDC to answer various questions about timing and enforceability raised by the State Funding Agreement.

MTA head "concerned" about $100M owed by FCR; developer says first tower residential

On the New York Observer's Real Estate blog yesterday, Eliot Brown mined a April 9 "webinar" by the Metropolitan Transportation Authority, in which executive director Elliot (Lee) Sander expressed concern about the whereabouts of the $100 million in cash that developer Forest City Ratner in 2005 agreed to pay for the agency's Vanderbilt Yard.

The Observer's report also quoted FCR spokesman Loren Riegelhaupt, who stated that the first building to open, along with the arena, would be residential. That means that Building 1, aka Miss Brooklyn, remains on hold until an anchor tenant is found, as the New York Times first reported last month. It also means that, unless certain parts of Building 1 are completed, the arena would open without the Urban Room, the atrium that would serve as a combination building lobby, arena entrance, subway entrance, retail/restaurant space, and public gathering space.

Sander's concern

Sander was asked why, if the agency was about to sell the West Side Yards, was it crying poor. He said the money is assigned to the 2005-09 capital program, and brought up Atlantic Yards without being asked. (The segment appears about three-quarters of the way through the webinar.)

His comment:
There was approximately a billion dollars associated with the sale of MTA real estate assets to support that program. There are some monies there that look like there may be challenges to proceed upon right now. There is money there--100 million dollars associated with the sale of Atlantic Yards, and I think many of you have read in the newspapers some of the difficulty Forest City is having with that development, so hopefully that will proceed, but we want to make sure that that happens—but we’re concerned about that.

Note that he incorrectly used the term "Atlantic Yards" to refer to just the railyard.

FCR says: later this year

Riegelhaupt, a spokesman for the developer, told the Observer that the $100 million would be delivered later this year, once the company closes on the deal.

(Does that mean before lawsuits are cleared, or after? If the latter, it may not be later this year.)

FCR's statement

The Observer offered Riegelhaupt's statement. This first part isn't new:
The reality is the project is moving forward and we are making significant progress on the site each day. Thus far we have contracted out over $42 million worth of work on the site and roughly 50% of the structures on the site have already been taken down. We have begun construction of the temporary rail yard and we expect to break ground on the arena later this year.

Of course, Chuck Ratner of Forest City Enterprises last year said the developer was "committed" to opening the arena by 2009.

Affordable housing by 2011?

Riegelhaupt's statement continued:
We expect to open the first residential tower, which will have a significant amount of affordable housing, at the same time as the opening of Barclays Center. By that time we also expect to have started construction on the second residential tower which will also have a significant amount of affordable housing. The rest of Atlantic Yards, including all of the remaining affordable housing, will be built out from there.

What does "same time" mean? Officially, the developer promises the arena by 2010. A more realistic best-case scenario is 2011. Maybe we'll learn more about the timetable if the state Assembly passes a law proposed by Assemblyman Richard Brodsky that would require the Empire State Development Corporation (ESDC) to report on the status of major projects, including Atlantic Yards.

How much affordable housing?

How much affordable housing is "significant"? As stated in a Memorandum of Environmental Commitments issued (but little noticed) when the Empire State Development Corporation approved the project 12/8/06:
The Project (including Phase I and Phase II) shall generate at least 2,250 units of affordable housing on site for low-, moderate-, and middle-income persons and families. At least 30% of the units built on the Arena block in Phase I shall be affordable to such households.

This was first announced at a hearing in September 2006 of the City Planning Commission. That might mean 600 of 2000 units, but there's no guarantee how long Phase 1 might take. After all, the developer has 12 years after the close of litigation and the delivery of properties via eminent domain to complete that phase.

The longer the project takes, the easier it might be to compete for scarce affordable housing financing, since the $1.4 billion request would be spread out over many years. But it's notable how Forest City Ratner, in the face of criticism by conditional supporters like City Council Member (and Brooklyn Borough President candidate) Bill de Blasio, is beginning to repeat the "affordable housing" mantra that ultimately became the center of the AY narrative.

Over 12 years, 600 units means 50 units a year.

Questions unanswered in the State Funding Agreement

One lesson from the Atlantic Yards saga is that, at least in this case, the approval in December 2006 by the Empire State Development Corporation (ESDC) was not the end of the story but a midpoint, given that negotiations regarding funding agreements--and thus project deadlines--were in the future.

(Is this standard operating procedure for most ESDC projects? That's a question worth looking into.)

And even the State Funding Agreement, signed last September but made public last month, leaves several ambiguities subject to further negotiations. In other words, it's very much not over--but the negotiations are not exactly public. Perhaps the law, proposed by Assemblyman Richard Brodsky, requiring the ESDC to report on details of the project might get to some of these details.

Pending questions

Part 33 of the Funding Agreement includes Exhibit K (Project Documentation Terms), which contains some unresolved or ambiguous segments.

(First page at right; click to enlarge)

I posed several questions to the Empire State Development Corporation. Spokesman Warner Johnston told me last week it was too soon to provide details: "Exhibit K to the funding agreement sets forth certain requirements, or parameters, to be included within the project documents (i.e. the development agreement, leases, etc) with the expectation that certain terms and conditions would be negotiated at a later date (but prior to acquisition of the site and finalization of the documents). "

"The Project Documents have not been finalized and the negotiations are on-going," he added. "Accordingly, we are not in a position, at this time, to respond to these specific questions while the details are being negotiated. Once the documents have been finalized – all project terms will be made available."

[Below, the questions I posed.]

Arena delays

Under Arena Commitment and Remedies, it states that a failure to complete construction within 6 years means an obligation to "repay each year a portion, to be established in the Project Documentation, of State Funding." When might that be established? Do we know the size of each portion?

Phase 1 delays

Under Phase 1 Commitment and Remedies, it similarly states that a failure to complete construction within 12 years means an obligation to repay "a portion to be established...." Again, do we know timing or amount?

Phase 2 delays

Under Phase 2 Commitment and Remedies, it states that a "Final Deadline" will be established in the Project Documentation. Again, when might the documentation be concluded?

When's Final Deadline

That same section refers to a Final Deadline that takes "into account the need for satisfaction of Governmental Authorities' obligations to the Project."

I'm not clear on what "Governmental Authorities' obligations" means--is that the direct subsidies of $100M from state and $205M from city? Or does that refer to affordable housing finance? Or something else?

Timetable for affordable for-sale units

Under Affordable Home Ownership, it says that "Developer shall provide 600-1000 units..." but there's no timetable or enforcement mechanism. Will there be one? By when? What might it say?

Investing in parks

Under Open Space and Park Improvements, it states "Developer or its Affiliates shall invest $3 million..." Again, any timetable or enforcement mechanism?

Timing issues

I asked Johnston if ESDC had any estimate of when negotiations would be completed. He responded: "I don't have a ballpark but we are working to expedite these negotiations."

Behind 80 DeKalb, FCR's test run for AY marketing (and, probably, housing bonds)

Forest City Ratner's plan for a 365-unit rental apartment building at 80 DeKalb Avenue, a new tower at the edge of Fort Greene and Downtown Brooklyn, offers some obvious and not so obvious parallels regarding the housing planned for the Atlantic Yards project.

The marketing of residential real estate--a first for FCR in Brooklyn and one of only three such company projects in the city--presents the obvious parallel. (Rendering from architect Costas Kondylis. Click on graphics to enlarge.)

The less obvious parallel: the developer's success in gaining scarce tax-exempt bonds from the state housing finance agency--in an application that earned praise from the agency's head--shows that FCR may be well-positioned to compete for similar bonds from the city housing finance agency to build AY.

For 80 DeKalb, a tower planned for a slice of a seven-story building Forest City Ratner bought in 1989, the developer was able to request somewhat less bonding per unit than competing projects--likely in part because of low land costs. (A package of mortgages regarding the property, which has a total of some 761,000 square feet of building/development rights, initially totaled $30 million.) For AY, the developer may be able to similarly out-compete other projects, in part due to various subsidies and tax breaks.

(In photo looking east along DeKalb Avenue, note Fort Greene Park and Brooklyn Tech High School--once an apparent FCR target for development--in the background.)

At "Investor Day"

During an "Investor Day" meeting last October, as I reported, FCR's MaryAnne Gilmartin described 80 DeKalb as “the first opportunity for our company to capitalize on… the residential renaissance that we see in Brooklyn. And it allows to sample the market firsthand as a preview for Atlantic Yards. So in many ways it will inform the rollout of our residential product for the Atlantic Yards project.”

(Map at right from MetroTech Bid. 80 DeKalb is the oval segment of the building in the lower right of the map. Map below of the BAM Cultural District at right is from the Downtown Brooklyn Partnership; 80 DeKalb is the oval segment of the building at top, while the circle indicates the Forte Tower on Fulton Street.)

The building, the back segment of a factory-turned office building also known as 10 MetroTech, would be 365 feet tall (plus another 35 feet for water tower and elevator machine room) and occupy 335,268 square feet over 34 stories. When it opens--the schedule says next March--it will be close to the BAM Cultural District, where some new high-rise buildings, including housing, are planned.

Access to tax-exempt bonds

To pay 60% of the $207.3 million project cost, the developer will use scarce tax-exempt housing bonds, which carry an interest rate of some 175 basis points less--e.g., 4.25% vs. 6%--and thus boost borrowers. (The federal government, which takes the hit on lost interest, limits each state's allocation; Congressional legislators from New York City are trying hard to get an increase in "volume cap" for the city.)

Though 80% of the building will be market-rate, it's typical for tax-exempt bonds to pay for half of more of such projects. The 20% low-income units would be for four-person households earning $35,350 or less; such 80/20 projects gain tax-exempt bonds via a program of the New York State Housing Finance Agency (HFA).

Atlantic Yards, with rental buildings containing 50% market-rate units, 30% middle/moderate-income units, and 20% low-income units, would compete for bonds issued by the New York City Housing Development Corporation (HDC). Both HFA and HDC have far more projects in the pipeline than they can fund, given the federal government's limited allocation of some $1.6 billion a year for the state.

Atlantic Yards, at least according to financial documents submitted to the Public Authorities Control Board, would involve $1.4 billion in tax-exempt bonds out of a then-$4 billion project cost. Or, subtracting the arena, it could be said that the housing bonds would involve $1.4 billion out of $3.36 billion for the non-arena portion of the project.

Winning the competition

FCR, along with three other projects, was selected among 14 projects for the state agency's bonds, because "we view [the 80 DeKalb project] as an efficient use of a scarce resource," said Priscilla Almodovar, President and Chief Executive Officer of HFA.

She praised FCR: "[T]he developer agreed to limit its allocation to $1.5 million per low-income unit--lower than our $1.7 million ceiling--and agreed to permanent affordability for its low-income units rather than for just 30 years. In addition, given the turbulent credit markets, projects that were in the ground and had their financing lined up were given priority. Lastly, the project will bring a mixed-used project to Brooklyn at a time 80/20 projects are usually proposed for Manhattan. I anticipate recommending this project to the HFA board later this spring.”

(At right, a west-facing view of the construction site.)

The three other projects moving ahead, all in Manhattan, are requesting $1.65 million, $1.7 million, and $1.9 million per unit, though two will be permanently affordable to low-income tenants, while the Brooklyn project will offer a different version of permanent affordability, to somewhat higher-income tenants.

Earlier this year, in an effort to make the best use of volume cap, HFA suggested that developers not ask for more than $1.7 million per unit, and set other allocation criteria, such as project readiness, length of affordability, and consistency with the city's goals. Some developers have asked for well over $2 million per unit, even $3 million, according to the New York Observer.

FCR's bid

For-profit developers build affordable housing because the projects make financial sense. A developer's returns on such 80/20 projects can reach 30%, according to a source quoted in the Observer. So a developer with lower land or development costs--or even a lower profit goal--can compete with rival projects by requesting a somewhat lesser amount of bonds per unit and offering, as FCR did with 80 DeKalb, some sweeteners. In that sense, it's somewhat like a blind bid.

Forest City Ratner, part of a publicly-traded company based in Cleveland, is likely not sacrificing profits on 80 DeKalb. Rather, its relatively low bonding request per unit likely reflects a smart decision acquiring the property inexpensively in 1989 and seeing (likely, helping) it get rezoned a dozen years later to accommodate residential development, thus boosting the value of the land.

An advantage for AY?

A similar process may await for Atlantic Yards. Though the financing of the project and the developer's plans remain murky, it's reasonable to speculate that, given the significant amount of subsidies and tax breaks for Atlantic Yards, plus the advantage of eminent domain, Forest City Ratner may be able to compete by asking for somewhat less per unit than other 50/30/20 projects before HDC.

And should the developer gain the additional subsidies it seeks, that that could further help it compete for housing bonds.

(At right, a view west along Fulton Street. The office entrance to 10 MetroTech is along Fulton Street in the brick building clad in silver to the left. Note the lingering Bogolan banner.)

For AY, the projected $1.4 billion in housing bonds for 4500 rental units works out to $311,000 per unit. I found scant opportunities for comparison with other 50/30/20 projects; one announced in 2004 in Harlem involved 234 apartments and $44 million in tax-free bonds, or $188,000 per unit. Another 2004 project involved $54 million and 211 units, or $256,000 per unit. So, given cost increases, AY would be in the ballpark.

Other reasons to pick AY

Moreover, Atlantic Yards may meet other criteria under which projects compete. For example, HFA's term sheet this year set a maximum per low-income unit and cited, among allocation criteria, length of affordability and project readiness, as well, as furtherance of New York City's goals, "as evidenced by written input from New York City's Department of Housing Preservation & Development which will include projects in recently rezoned areas or on 'catalytic' sites that will spark nearby high-priority development, as well as projects on city-owned land."

It's plausible that HDC could establish similar criteria. The AY site hasn't been rezoned, would no longer contain city-owned land (it would be owned by the state), and arguably wouldn't "spark" nearby development, which is mostly doing fine, albeit mostly market-rate housing.

However, the city's goals include increases in large amounts of affordable housing for both low-income and middle-income groups. So a mayoral administration backing Atlantic Yards could presumably help nudge the project toward the front of the list. Perhaps that's why HDC head Mark Jahr in February expressed confidence Atlantic Yards would be funded.

HFA also cites special consideration to projects involving difficult to house populations, such as those with special needs or very low-income, and those meeting certain energy efficiency measures. Atlantic Yards likely would get points for the latter, as well.

(The federal General Services Administration, or GSA, has leased space at Ten MetroTech, with an entrance on Fulton Street, and is still marketing it to sublease. GSA spokeswoman Renee Miscione told me last May that the agency, which has leased space since the early 1990s from Forest City Ratner, now leases under 150,000 square feet. Scroll down for photo that shows that Community Benefits Agreement signatory Brooklyn United for Innovative Local Development, or BUILD, has moved from FCR-provided free space on Pacific Street in the AY footprint to free space in the ground-floor of Ten MetroTech.)

The 80 DeKalb apartment mix

HFA held a public hearing April 15 at its 641 Lexington Avenue offices regarding the bonds contemplated for 80 DeKalb and three other projects. Such public hearings are apparently pro forma; this one attracted clusters of representatives from each developer, HFA staff, one curious reporter, and exactly one person to testify.

That was Alfred Chiodo, a staff member from Council Member Letitia James's office, who was put in the somewhat awkward position of praising a project from a company whose AY project James opposes vigorously, and then asking the developer for something of a favor.

Given the crisis in affordable housing, and the number of families in need, Chiodo said James hoped that the affordable units at 80 DeKalb be skewed toward larger apartments. "Ideally I would like to see a mix of 15% studios, 30% 1 bedroom, 50% 2-bedrooms, and 5% 3 bedrooms," James said in a letter submitted to HFA.

Forest City Ratner staffers sitting at the conference room table, who had the option to publicly respond to any comments but were not required to do so, didn't immediately inform Chiodo that a rather different apartment mix is planned, as a perusal of the plans showed.

HFA spokesman Philip Lentz later gave me the tally.
Affordable units: 25 studios, 37 1BRs, 11 2BRs.
Market-rate units: 98 studios, 151 1BRs, 42 2BRs (plus super's apartment).

While Forest City Ratner may not plan many 2BR affordable units in this building, they're not violating any guidelines. The building as a whole has relatively few 2BR units, and HFA understandably requires proportionality--that, in a building with 20% affordable units, at least 20% of each apartment type be affordable.

A letter to HFA from Forest City Ratner's Gilmartin pointed out that Community District 2 "is rapidly developing with hundreds of lxuury condos under construction or in the pipeline, yet 40% of the households currently in CD2 have an income of 50% of AMI [Area Median Income] or below. Given the dearth of affordable apartments built in CD2 during the last prosperous real estate cycle, the 73 low-income units that 80 DeKalb will generate will allow working families and individuals a chance to stay in the their community and benefit form the growth."

Under HFA guidelines 20% of the units must be low-income units under 50% of AMI. So, of the 73 total affordable units, 15% of those--11 units--must be accessible to households under 40% of AMI.

Market-rate vs. affordable

Will the affordable units be second-class? Well, yes, though that's dwarfed by access to the scare resource of an affordable apartment in a well-maintained building. (With rents at 30% of income, a two-person household at 50% of AMI would pay just $638 a month, according to the AY affordable housing chart.) And, as Bertha Lewis of ACORN has famously said about the affordable housing planned for AY, everyone will be taking the same elevators.

On the other hand, developers are granted some flexibility to maximize the value of their property. “It will have doorman/concierge services, a 150-car garage, a lifestyle center that includes a gym, a library and a lounge and retail at the ground floor level,” Gilmartin said at Investor Day.

While both market-rate and affordable units must have comparable sets of fixtures, a developer is allowed to upgrade market-rate units. So expect much higher-end fixtures in the latter.

For 80 DeKalb, as HFA's Lentz explained, HFA requires that affordable units be located up to at least 60% of the building floors. (In a 34-story building like this, that means affordable units must be located up to at least the 20th floor. City programs are more stringent, involving 80% of the building's floors.) Also, on no floor can more than 50% of the units be affordable.

Also, HFA grants some flexibility regarding the size of the affordable units. Though the agency requires that 20% of the units be affordable, it requires that only 18% of the floor area be devoted to those units, thus allowing for somewhat smaller units. For 80 DeKalb, FCR plans to devote 18.6% of the floor area to affordable units, according to documents submitted to HFA.

The three other projects on the road to HFA approval, all in Manhattan, set aside 20% or more of the floor area to affordable units. HFA's Lentz pointed out that a city inclusionary housing program "requires a low-income room size which may be larger then the market rate counterpart," which may explain the slight discrepancy between the Manhattan projects and 80 DeKalb.

While HFA does not require affordable units to be specific sizes, it does require that each affordable apartment type on average be no more than 20% smaller than the market counterparts.

A look at the plans for 80 DeKalb shows studios ranging from 450 sf to 550 sf, 1BR units from 568 sf to 718 sf, and 2BR units from 779 sf to 1267 sf, with a couple of larger units called 2BR-plus. So it's a good bet that many of the affordable units, including those relatively small 2BR units. will be on the smaller side.

Some sweeteners

FCR is adding some important sweeteners to the deal. HFA said it would prioritize projects that offer affordability beyond the agency's standard regulatory agreement, 30 years.

Also, the developer agreed to extend affordability for five years, then rent--for more than 60 years--the affordable apartments for households earning up to 90% of AMI, which is not low-income but still below market rate. (The term would technically be "99 years from the initial date of the HFA Regulatory Agreement," signed when the mortgate is issued.)

How they got there

The building at 80 DeKalb, bounded on the south by Fulton Street, is a former Barton's candy factory, which closed in 1981 and, according to a 6/9/85 article in the New York Times, was in converted to office space. Forest City Ratner bought the property four years later, in mid-1989, branding it as 10 MetroTech, the building in the far southeast of the sprawling complex.

The initial expenditure, according to documents at the city's ACRIS database, consisted of three mortgages totaling $30 million (assuming I'm reading it right): a Building Loan Mortgage, a Mortgage, and the Project Loan Mortgage. Property Shark indicates that the market value of the building is $83.8 million. It also notes that the developer, upon purchasing the building, spent millions to upgrade it. It's not clear to me whether an announced $12.8 million cost on 10/16/90 was an expenditure or an estimate; note that in 1991 two projects, for $3.6 million and $1.25 million, seem to cover some of the same ground.

Note that Property Shark declares that the building occupies 687,035 square feet, including 359,000 office sf and 328,035 "other sf." The latter, I think, refers to the yet to be built apartment tower.

As the list at right and above suggests, those initial mortgages and future mortgages were consolidated several times, leading to the latest mortgage of $73.5 milion. (Scroll to the bottom for pages from a legal document indicating a complex series of transactions.)

To find the documents, search on ACRIS using block 02094 and parcel 0001, in Brooklyn.

Sources and uses

A document filed with HFA indicates the sources & uses of funds, which each total $207,343,679. Under sources, FCR anticipates $124.1 million in tax-exempt bonds, $21.9 million in taxable bonds, $10.9 million in tax-credit equity, and $50.5 million in developer equity.

As for uses, the document indicates a "land cost" of $45.1 million, which along with hard costs of $130.3 million, soft costs of $29.5 million, and a developer fee of $2.5 million.

That $45.1 million figure is not the actual cost of the land but rather the developer’s estimate of the land value, Lentz confirmed. "The lender does an independent appraisal before the project is finalized."

A real estate professional I spoke with for another article estimated the value of development rights in Downtown Brooklyn as $75-$100 per square foot, which suggests a value of less than $34 million for this property.

On the other hand, if the developer already has much of the land paid for, well, the portion of the loan covering the $45.1 million for the land value might be gravy.

Special Downtown Brooklyn District and rezoning

In 2001, the property received a huge boost in value when a rezoning allowed residential construction. According to the Department of City Planning's page on the Special Downtown Brooklyn District:
On July 26, 2001 the City Council adopted a proposal by the Department of City Planning to establish a Special Downtown Brooklyn District and to rezone eight adjacent areas in Community District 2.
...Two blocks bounded by DeKalb Avenue on the north, Ashland Place on the east, Fulton Street on the south and Hudson Avenue on the west are rezoned from M1-6 to C6-4. These two blocks contain offices, a theater, retail and housing. There are no manufacturing uses on these blocks.

The C6-4 District has the same maximum FAR of 10.0 as the M1-6 District, and is an extension of the C6-4 District mapped immediately to the south. C6-4 Districts do not permit new manufacturing uses, but permit residential uses and a wider array of commercial and retail uses.

(Click on map to enlarge. Original here.)

A FAR of 10.0 allows for some very large buildings--fully occupying ten times a property's footprint; in this case, the building is up to seven stories, allowing for a tall tower to be built over a fraction of the space,

Though the allowable size of the buildings remained the same under the rezoning, there's a big difference between the M1-6 District, which allows only manufacturing and commercial uses, and a C6-4 District, which allows housing but not manufacturing.

In other words, as Brooklyn was changing, gaining a luxury housing market, this was an understandable move--and a lucrative one for Forest City Ratner, which had gotten the property cheap.

Rezoning

How did the rezoning come about? I haven't had the time to dig into it, but it's certainly plausible as a piece of urban planning. And it's also plausible that Forest City Ratner, a leading lobbying client in the city and state, helped nudge it along.

[Update 8/21/08: While this was previous to the Downtown Brooklyn rezoning, it was part of a Special Downtown District in 2001 and thus a fairly thorough rezoning.]

In a search of the City Clerk's lobbying database, I couldn't find specific reference to Forest City Ratner pushing for 80 DeKalb to be part of a Special Downtown District. However, the information is incomplete. FCR's own copious lobbying activities do not delineate "target" and "subject," as required, and the details (at least in the electronic form of the database) from one FCR lobbyist, the firm Geto & DeMilly, trail off after the words "various issues in connection with." So it's possible that 80 DeKalb was the subject of some lobbying.

The inexorable march

The 80 DeKalb project should not be seen in isolation. At Investor Day, Gilmartin said “we think the critical mass of new residential construction along Flatbush Avenue validates the corridor as a thriving and desirable residential location. This is important not just for 80 DeKalb… but for all that we intend to do with Atlantic Yards.”

Indeed, the transformation of Flatbush—a spine of towers—would make Atlantic Yards less anomalous. Still, though the latter would extend well beyond major thoroughfares and extend the boundaries of Downtown Brooklyn.

At right, the current view looking north on Flatbush from the western corner of DeKalb Avenue. (Note the sign for Junior's Restaurant.) Below is Flatbush Avenue in 2012 from the Downtown Brooklyn Partnership. The Nets billboard, by the way, appears in the time-lapse timeline as of 2009--clearly premature.

The series of mortgages

This is attached to the ACRIS documents regarding the recent mortgage of $73.5 million.

Will Bloomberg's PlaNYC 2030 survive his mayoralty? Should it?

Many people concerned about planning and development issues were heartened by Mayor Mike Bloomberg’s announcement last year of PlaNYC 2030, observed Eve Baron, director of the Municipal Art Society (MAS) Planning Center. However, as she said introducing a forum titled “PlaNYC2030 Post-Bloomberg” on April 14, many people think important issues were left out--and the panel discussion bore that out.

Indeed, she said, the Community-Based Planning Task Force the MAS helped launch sought a more open process.

The mayor’s plan was not submitted as a 197-a plan, Baron noted, which makies it “more of an agenda,” with its applicability potentially limited once he leaves office. (“Section 197-a of the York City Charter authorizes community boards and borough boards, as well as the Mayor, the City Planning Commission, the Department of City Planning, and any Borough President, to sponsor plans” which are reviewed by the CBs, borough presidents, City Planning Commission, and City Council once adopted, they are used to guide subsequent actions by city agencies.)

Many more community plans have been drawn up, and MAS has just compiled them into a new Atlas of Community-Based Plans. While it was originally created to inform candidates running for local office, now it’s an educational tool for the public, providing examples for communities that need advice on creating their own plans. One example in the atlas: the UNITY plan alternative for the Metropolitan Transportation Authority’s Vanderbilt Yard.

Criticism and reflections

Tom Angotti, a planning professor at Hunter College and a member of the task force, said one reason it was launched was frustration with City Hall and the Department of City Planning. Though eight 197-a plans--of many others developed--have been passed, the day after, “City Planning ignores them,” he lamented.

(Sustainability Watch, a collaboration between Gotham Gazette and the Hunter College Center for Community Planning & Development (CCPD), monitors and debates the city's plans. In an article posted yesterday, headlined Is the Long-term Sustainability Plan Sustainable?, Angotti amplified many of the points he raised during the panel. Here's an article from today's New York Sun that links to a report by the New York League of Conservation Voters Education Fund, which gives mixed-reviews regarding the plan's 127 initiatives, praising reduction of carbon emissions, a start on planting trees, and energy efficiency programs, but criticizing too few transportation improvements outside of congestion pricing and not putting the plan into law--the issue Baron raised.)

Angotti cited CCPD’s work on the UNITY plan as “is a project that helps us define what we mean by sustainability,” he said, suggesting that the question was “what’s being sustained and who benefits.” UNITY’s visions, he said not without edge, “go far beyond [AY architect] Frank Gehry’s hallucinations.”

CSOs and CP

Miquela Craytor, deputy director of Sustainable South Bronx, noted that the Storm Water Infrastructure Matters (S.W.I.M.) coalition, which advocates for green infrastructure to reduce combined sewer overflows (CSOs), had pointed out where PlaNYC 2030 fell short.

Paul Steely White, executive director of Transportation Alternatives, was still smarting from “congestion pricing going down in flames.” Why did it fail? “We didn’t do a good enough job of defining sustainability in human terms,” he reflected. “We let the opposition define the downsides.”

While London has been the city most cited as an example for New York, given its history of road pricing, White suggested that Paris or Bogotá are better models, since both have more aggressively reorganized (and even closed) streets to better serve ctizens.

Enough inclusion?

Moderator Amy Zimmer of Metro asked if the panelists’ groups felt represented in PlaNYC. “We weren’t asked to the table,” Craytor said, suggesting that the administration bears an animus to Sustainable South Bronx for its opposition to a planned jail in the South Bronx. She suggested the plan scants the importance of jobs

Yolanda Gonzalez of Nos Quedamos, an organization that has grown since it significantly reshaped urban renewal plans in the Melrose neighborhood of the Bronx, said the NYC Environmental Justice Alliance, to which the group belongs, had to speak with one voice and, even if members didn’t agree with all of the plan, supported its broad goals, especially the need to reduce truck traffic.

Angotti scoffed at the “Town Hall meetings” set up by the Mayor’s Office of Long-Term Planning and Sustainability, calling them “a public screening of the mayor’s slide show.” He pointed to the plan’s precursor, an unreleased (but leaked to Streetsblog) land use plan by Alex Garvin. That plan, Angotti noted was developed for the New York City Economic Development Corporation, not the City Planning Commission.

PlaNYC, he alleged, “was really to sell a plan that was already made.” Civic activists brought into the process, he said, ‘really deserved to have a dialogue, not a monologue.” None of the plan went before Community Boards or community-based organizations, he noted. Such failure to consult, he suggested, was “blowback” that led to the demise of congestion pricing. He did allow that Bloomberg did appoint a progressive Department of Transportation commissioner, Janette Sadik-Khan, but said that may not be enough.

White was more optimistic, saying there remain opportunities to improve bus service, make streets friendlier, and expand the bike network. “There is this tension between real estate and development,” he acknowledged. “It’s not going to go away.”

Next mayor

What should the next mayor do, Zimmer asked. Focus on parking policy, White said, noting that the city has collected too few statistics regarding parking; only when the number of spaces are counted can New York consider limiting them, as some other cities have done.

Gonzalez talked about the promise of solar panels. Craytor mentioned green roofs.

Angotti even took issue with the goal that every resident be within a ten-minute walk of a park. “For a lot of people, a ten-minute walk is a challenge.”

Some contentiousness

In the Q&A segment, the panel came in for criticism from Manhattan Borough Historian Michael Miscione, sometimes a gadfly, who called it “extremely cynical and negative.” Communities, he warned, can suffer from provincialism: “It’s important to have a perspective that looks at the greater good.”

That was one of the themes that emerged during the recent reassessment of master builder/power broker Robert Moses. Two of the panelists, however, were from the South Bronx, a neighborhood that can most defensibly say no. It has four power plants, 12 substations, and garbage galore. “We are oversaturated, overburdened to start with,” Gonzalez said.

Another audience member, who identified himself as a PlaNYC fellow, earnestly described his frustration in trying to engage communities. “It’s not true we’re not consulting,” he said, it’s just that people don’t show up. “Do we engage them, or propose something and let them criticize it?” he asked.

Gonzalez said Nos Quedamos had hosted a PlaNYC event with more than 60 organizations involved, but said city staffers didn’t follow up. Craytor warned that, given the prior distrust in certain communities, “you won’t overcome it in two hours.”

Nor, even, at this panel.

Newark option gets more realistic, even as Nets seek Euro companies for Gehry arena

Forest City Ratner has no intention of moving the Nets to Newark, not even as an interim solution while the Barclays Center is being built. However, suggests the Newark Star-Ledger's editorial board in a blog commentary headlined Newark hoop dreams, the New Jersey Sports and Exposition Authority may be willing to make a move--though not an interim one--easier.

The Authority owns the Izod Center at the Meadowlands and, if the Nets were to leave for a venue other than Brooklyn (or Queens), the penalty this year would be $12 million (though it would decline in subsequent years).

Long-term solution?

Comments the Star-Ledger:
That clause was generally considered to be anti-Newark. Considering that the authority is a state agency, the provision seemed as hideous and out of place as a giant, psychedelic Ferris wheel in a swamp.

Something has happened. The hateful clause is being explained as a nonhostile means of preventing the Nets from pitting the Meadowlands against Newark. It was meant to avoid a bidding war for a short-term contract while the Brooklyn arena was built.

In fact, sources have told The Star-Ledger editorial board that if the Nets sign a long-term deal to play in Newark, the sports authority would waive that clause and happily cooperate with the Prudential Center for the greater glory and profit of both New Jersey venues.

A long-term deal is not, however, an enticement for the Nets to "test" Newark for three or more years while the Brooklyn arena is under construction, assuming that happens.

Even if the Nets consider the Newark option--and surely they must have a spreadsheet detailing potential new revenues, new costs, and the limits of being the tenant in someone else's arena--Newark doesn't become realistic until and unless Atlantic Yards finally implodes.

So, if the Nets move to Newark, as the commentary suggests, it will because they are sold to some local investors.

Showing confidence

Indeed, despite the record-setting $950 million price tag for the Atlantic Yards arena, Nets officials are confident they can piggyback on the Barclays Center naming rights deal and entice some more European companies to investment, reported the Record yesterday, in an article headlined Can the Nets afford to move to Brooklyn?

And starchitect Frank Gehry, with his international reputation, is the secret weapon.

Paying for it all

And there's some calculation behind all the marketing moves. The Record reports:
Chicago-based sports marketing consultant Marc Ganis, who calls the Brooklyn arena cost estimate "mind-boggling," said pro teams can obtain financing against reliable revenue streams, such as naming rights, sponsorships and advertising partnerships. This "contractually obligated income," including suite and premium ticket sales, means it may be somewhat less daunting to build an arena these days than other development projects.

And that's why the arena's moving ahead, while Miss Brooklyn awaits an anchor tenant.

Arena, 2011?

The article suggests that critics like myself are right when we suggest that 2011, not the 2010, is the likely best-case scenario for a Brooklyn arena:
The Nets will remain at the Izod Center in 2008-09 and 2009-10 and probably will play an additional season in East Rutherford unless an appellate court ruling on an environmental challenge to the plan is reached quickly this fall.

Nets attendance

Another article from the Record reminds us that official attendance and gate count are not necessarily the same thing:
The Nets ranked 21st of 30 NBA teams in attendance this season, with an official tally of 15,656 per game. The average turnstile count — the number of fans actually in the Izod Center — was 12,673 in a building with a 19,990 capacity for pro basketball.

Now he tells us: NYT's Ouroussoff criticizes "distorted reality" of project renderings

In an essay in yesterday's New York Times, headlined Now You See It, Now You Don’t, architecture critic Nicolai Ouroussoff finally took aim at the obvious, pointing out that architectural renderings are part of the marketing scheme for a major development, and that misleading and incomplete renderings produce a "distorted picture of reality" that "stifles what is supposed to be an open, democratic process."

Now he tells us.

Ouroussoff chooses for his example Tishman Speyer's Hudson Yards plan (above) which he acknowledges "represents the norm," no worse and no better than its counterparts. Unmentioned, but implicitly in the same ballpark, is the Frank Gehry rendering of AY (right) that the Times published on the front page 7/5/05, accompanying the article misleadingly headlined Instant Skyline Added to Brooklyn Arena Plan.

Nostra culpa

So let's read that as an implicit mea culpa for Ouroussoff's coverage of Atlantic Yards and a nostra culpa for the Times's coverage overall. After all, a sense of AY in neighborhood scale is the single most important piece of information that hasn't gotten through to the general public, and the Times, by publishing promotional renderings by Gehry, a photo of project designers in front of a wall showing graphics of the project, and a photo of the Metropolitan Transportation Authority's Vanderbilt Yard, has failed in its responsibility to show that scale. And Ouroussoff and predecessor Herbert Muschamp, found reasons to celebrate Gehry's renderings rather than ask hard questions or try to fully inform the readers.

Nor has the Times blown the whistle on misleading renderings produced for Atlantic Yards. I'll repeat that, given that the parent New York Times Company has a business relationship with Forest City Ratner, partners in the new Times Tower, the newspaper has an obligation to be exacting in its coverage--and it hasn't.

(The image above, looking west at Dean Street east of Sixth Avenue, from Gehry Partners, appears in the in the AY Final Environmental Impact Statement issued in November 2006. At right is a far more benign rendering, released by Forest City Ratner in May 2006, that shows Dean Street looking east. Click on graphics to enlarge.)

Another distorted rendering released in May 2006 (right) showed the Williamsburgh Savings Bank building looming over the flagship Miss Brooklyn tower, even though at that time Miss Brooklyn was 108 feet taller and three times the bulk. As I wrote, when the plans were released, only the New York Observer's Matthew Schuerman pointed out the deceptive renderings.

Cautious developers, enabling critics

The essay begins:
BIG-TIME development has always been a rough-and-tumble world in New York. But in recent years, as government has ceded more and more power to private interests, developers have become magicians at negotiating their way through the byzantine public review process. Nowhere is this sleight of hand more visible than in the way they tailor architectural renderings for public consumption.

As the battles over mammoth-scale development grow more heated, developers and their marketing teams have become extremely cautious about the information they release before a project passes review, for fear of inciting a public outcry.

It's not just that the developers are cautious, it's that the critics help them along. Once very preliminary renderings were provided in December 2003 (right), Muschamp enthused that "a garden of eden grows in Brooklyn."

In his 12/11/03 essay, headlined Courtside Seats to an Urban Garden, Muschamp pronounced:
The massing models of the residential buildings will remind some observers of pre-Bilbao Gehry, when his vocabulary owed more to cubes than to curves.

I hope we haven't seen the last of those big cube buildings. As I think the models show, they have a toughness that looks right for New York at this uncertain moment in time. And they work wonderfully well with the garden setting Mr. Olin has devised for them.

Why was Muschamp musing on the world-historical setting for the "big cube buildings" rather than considering the view from the ground? (He infamously described the site as an "open railyard," even though that would be less than 40% of the site, and Times editors, with convoluted logic, resisted a correction.)

Confidentiality

Ouroussoff continues:
Architects are now regularly asked to sign confidentiality agreements that forbid them to talk to the press, a tactic that was virtually unheard of a few years ago. The images released to the public are often restricted to a few renderings that are carefully scrutinized in advance by marketing experts. As a result the public is often left without the visual tools it needs to make thoughtful judgments about a development’s impact.

Could Ouroussoff be hinting that Gehry is now forbidden to talk to the press? Or that he was always forbidden to talk to local residents?

Above, the embattled team of then-FCR executive Jim Stuckey, Gehry, and landscape architect Laurie Olin posing for the only photo the Times ran in print to accompany the 5/12/06 release of a third set of renderings, in an article headlined Developer Defends Atlantic Yards, Saying Towers Won't Corrupt the Feel of Brooklyn. Online, the Times also published a photo of the project model (right).

Neither of the two photos, nor the rendering (right) released at the time suggested neighborhood scale. Even though the developer had released some (distorted) renderings that suggested neighborhood scale, they didn't appear in the newspaper. The earlier 7/5/05 article came with even more fanfare, accompanied by a slide show of snazzy but unenlightening renderings.

Dissing West Side plan

Ouroussoff's essay continues:
The design for a 12-million-square-foot development proposal by Tishman Speyer Properties at the site of the West Side railyards is a case in point. When reporters showed up for its unveiling last month, they were handed a packet with a fact sheet and a few cursory renderings.

Basic details like the surrounding context were left incomplete; there were no elevations to show what the project would look like from the street. The largest of the models on display was cut off at mid-elevation, making it virtually impossible to understand the towers’ colossal scale.
(Emphasis added)

In his 7/5/05 appraisal, headlined Seeking First to Reinvent the Sports Arena, and Then Brooklyn, Ouroussoff was enthusiastic, treating the project as sculpture:
The striking collision of urban forms is a well-worn Gehry theme, and it ripples through the entire complex. Extending east from the arena, the bulk of the residential buildings are organized in two uneven rows that frame a long internal courtyard. The buildings are broken down into smaller components, like building blocks stacked on top of one another. The blocks are then carefully arranged in response to various site conditions, pulling apart in places to frame passageways through the site; elsewhere, they are used to frame a series of more private gardens.

As I pointed out, Ouroussoff didn't mention the superblock issue and, in hindsight, his enthusiasm was misplaced, since Gehry revised the plan to create new view corridors through the site.

Ouroussoff also hinted at inside knowledge, writing:
Mr. Gehry is still fiddling with these forms. His earliest sketches have a palpable tension, as if he were ripping open the city to release its hidden energy. The towers in a more recent model seem clunkier and more brooding. This past weekend, a group of three undulating glass towers suddenly appeared. Anchored by lower brick buildings on both sides, they resemble great big billowing clouds.

As I noted, the public wasn't given any picture of Gehry's work process; Ouroussoff seemed to signal that he had been receiving periodic updates of Gehry's designs. But he hadn't been looking from the ground. (Above, a slide published online by the Times.)

Distorted reality

Ouroussoff closes today's essay:
I don’t mean to single out Tishman Speyer for criticism here. On the contrary, the company represents the norm. Like most developers it probably sees architectural renderings as just one element of an elaborate marketing campaign. I’m sure it’s even proud of its designs. But the end result is a distorted picture of reality, one that stifles what is supposed to be an open, democratic process.

Some independent locals have contributed to a more open, democratic process, producing (imperfect) graphics of Atlantic Yards in neighborhood scale. Shortly before the AY public hearing 8/23/06, Brooklyn photographer Jonathan Barkey produced photosimulations (right, of the Dean Street playground, looking west) trying to show views of the project that were not available in the Empire State Development Corporation's Draft Environmental Impact Statement, issued 7/18/06. (Before Barkey's work, Will James and Jon Keegan set the stage with their own graphics.) Then came work by the Environmental Simulation Center for the Council of Brooklyn Neighborhoods.

Those graphics apparently made an impression. The Final Environmental Impact Statement, issued 11/15/06 (then updated and reissued 11/27/06), incorporated some projected views of the Atlantic Yards project unavailable in the earlier version, such as the rendering third from the top.

They've never appeared in the Times, or other dailies.

In Courier-Life, ACORN vs. de Blasio and some media conspiracy theories

So what’s the news behind the Courier-Life chain’s odd article this week about housing advocacy group ACORN's confidence in Atlantic Yards? After all, we know--from a statement issued March 21 in the wake of the Atlantic Yards stall--that Forest City Ratner’s affordable housing partner ACORN had “every confidence” in the developer.

(Click on all images to enlarge.)

One piece of news involves NY ACORN Executive Director Bertha Lewis’s clash with Council Member Bill de Blasio, an ostensible ally who has emerged as a critic of the project. "I'm sure Mr. de Blasio is only reflecting the concerns from a very small portion of constituents,” Lewis told the newspaper, with great but unproven certainty. “However, he also has a constituency that is very supportive of Atlantic Yards."

The other involves the rather bizarre sequence posited by Courier-Life reporter Stephen Witt, in which critical media coverage is blamed on “opponents,” rather than a recognition that maybe a lead story in the New York Times has some fallout.

The article fails to convey two important pieces of news. First, the developer has flexible time, according to the State Funding Agreement: 6+ years to build the arena, 12+ years to build Phase 1, and an unspecified time to build the rest of the public. Second, the president of parent Forest City Enterprises has publicly stated that “we still need more” subsidies. Beyond that, there’s a huge backlog of projects seeking housing bonds.

(Oddly enough, the article at issue appears in the Carroll Gardens-Cobble Hill edition of the weekly newspaper, above, but not in the Park Slope edition, below, which circulates in Prospect Heights, where the project would be located. The front-page stories in the latter issue regarded Public Place, in Gowanus, and the Kahlil Gibran School, in Fort Greene. Go figure.)

Subsidies coming?

The newspaper reports:
NY ACORN is currently working with FCRC and the city and state to iron out the affordable housing component of the project.
"My members and [sic] are confident this will get done," Lewis said.
"We have to deal with development and numbers changing ... We don't speculate about this. It is work that is actually going on and anybody who's ever done development would understand the process," she added.

Does this mean that Forest City Ratner will gain additional subsidies to build the project or get nudged toward the front of the line for housing bonds?

The p.r. campaign

By the article’s seventh paragraph, things get strange:
Lewis' comments came as opponents of the Atlantic Yards plan have continued a public relations campaign through both the print media and from brownstone bloggers.

What might we call columns in the Daily News by Atlantic Yards supporters Errol Louis and Michael Daly?

The quiet developer?

The article continues:
Meanwhile, FCRC has largely stayed out of the local community eye regarding the project since it underwent a lengthy public review process.
What FCRC has been doing is site preparation work including demolition of buildings the company has acquired and rail yard work, and letting out over $42 million worth of construction contracts with over 45 percent going to women and minority owned firms.

Um, the developer has also been doing things like giving $58,420 to the Democratic Assembly Campaign Committee's Housekeeping account.

Just a "recent story"

The article continues:
However, in a recent story in the New York Times, FCRC Chair and CEO Bruce Ratner admitted that the downturn in the economy could force some delay in the timeline of the total project build out.

That was a lead story, and it stated that Ratner “suggested that construction could be put off for years.”

The article continues:
This admission added fuel to the opponents' fire, who succeeded in getting stories aired in other Manhattan-based newspapers concerning subsidy amounts and rumors that FCRC was abandoning the project and would leave in its place vacant lots.

Is it not legitimate to try to calculate, as the New York Post did imperfectly, the public subsidies and public cost? Isn’t it public money?

(Note that the Post and the Courier-Life are both owned by Rupert Murdoch’s News Corp. and have both supported Atlantic Yards in editorials and distributed the egregious Brooklyn Tomorrow. The Courier-Life’s reporting has sometimes aired criticism of AY, but Witt's coverage could be broadly described as pro-project. The Post's reporting has been episodic and scoop-oriented, with with articles critical of the project, such as the one about subsidies, and essentially supportive of the project, such as the announcement of luxury suites for sale.)

And is it legitimate to suggest, as City Council Member Letitia James did in Metro,
that vacant lots might become parking lots? After all, interim surface parking is already part of the plan, as noted above, and, as I reported (thanks to a Freedom of Information Law request) documents submitted to the Department of City Planning show alternative plans (right) that would combine interim surface parking and temporary open space.

De Blasio goes oppo?

The article states:
Last week City Councilmember Bill de Blasio met with the opponent bloggers, where he told them he would call on Governor Paterson to call a moratorium on any more FCRC demolitions around the project and get an iron-clad agreement and timeline on the affordable housing.
De Blasio, a candidate for borough president, said he was a "conditional supporter" of the project until the Times story.

I think that Brownstoner and the Gowanus Lounge would hardly be considered “opponent bloggers.” They happened to show up at one of the periodic meetings de Blasio has held with local bloggers of all stripes.

Closing words from Forest City

The article closes with a quote from Bruce Bender, Executive VP of Forest City Ratner:
"As the Councilmember knows, all of Atlantic Yards, including all of the affordable housing, will be built and any delays in the construction phase will result in delays in delivering the thousands of units of affordable housing and thousands of jobs that Atlantic Yards will create.”

That clears everything up. At least there's an article (right) about how state law might be changed to allow Ultimate Fighting in the Barclays Center (and other venues). No doubt that's "recreational" under state law.

Reading Metropolis on infrastructure, preservation, and localism

The March issue of Metropolis magazine had three essays, under the rubric Local Flavors, that resonate with issues raised by Atlantic Yards and waterfront development. Collectively, they suggest a concern with infrastructure, preservation, and sustainable building that hasn't yet acquired criticial mass.

Kotkin on infrastructure

Joel Kotkin's Back to Basics: Manufacturing is still more relevant to long-term economic development than glitzy museums or massive sports stadiums, notes:
Over the past decade many city leaders have gravitated toward what might be called an arts-and-culture-led strategy. Even though most cities—including ballyhooed places such as San Francisco, Chicago, New York, and Boston—have achieved mediocre (or even negative) job growth and continue to lose middle-class families, they’ve celebrated reviv­als of their urban cores based on the migration of largely affluent “hip” residents. Much of this misplaced focus on culture is related to the decline of blue-collar jobs in fields like manufacturing and warehousing, a shift that many experts have long considered all but inevitable. It has been 17 years since futurist John Naisbitt casually described manufacturing as a “declining sport” that Amer­icans could easily outsource to Japan and other Asian countries. Reflecting this widespread belief, a number of mayors began focusing on glittering new culture and sports palaces, convention centers, and often publicly subsidized luxury-condo developments. But the limitations of this approach are becoming obvious, particularly now as the real estate “bubble” begins to deflate.

...In many cases these expansions are rooted in the recognition of each city’s natural assets along with a willingness to invest in ways that take advantage of them. ...These approaches are in stark contrast to cities like New York and Los Angeles, which invest far below the rate to even maintain their basic transportation, roads, and bridges.

...But the “back to basics” model may not be an easy sell in these first-tier cities, where the educational establishment often disdains skills-training as a hidden form of ethnic or class discrimination, and the political elite tends to be dominated by central-city real estate interests. Mayor Michael Bloomberg, who promotes New York as “the luxury city,” appears to place relatively low priority on such things as the city’s once bustling port and his­torically powerful role as a warehouse-and-distribution center. Of course, New York may never recover all of its blue-collar jobs, but there are promising niches—food processing for ethnic communities, “green” manufacturing for local construction, even furniture design—that play off the city’s natural strengths, such as its location, large immigrant workforce, and cutting-edge design community.

Note that Cooper Union's Fred Siegel, in a 4/11/08 AM NY appraisal of Bloomberg's terms, sums it up in two words: "luxury city."

Gratz on preservation

Roberta Brandes Gratz, in an essay headlined Urban Virtues: The values of historic preservation go far beyond the clichéd notions of nostalgia and NIMBYism, uses the example of the restoration of the Eldridge Street Synagogue on the Lower East Side:
Restoring landmarks and renovating existing buildings provide all of the economic benefits inherent to localism; these strategies are also far more sustainable (in the truest sense) than most new construction. As architect Carl Elefante has said, “The greenest building is one that is already built.”

(This has already been said about the Ward Bakery, undergoing demolition for the AY project.)

Gratz notes some unraveling from rezonings:
Despite the obvious local benefits associated with the synagogue restoration, many of the firms involved say their ability to stay in business is threatened by recent zoning changes and intense real estate speculation, which has shrunk both the supply of industrial space and housing opportunities for the skilled workforce these companies depend on. Dawn Ladd, who moved her lighting company from New Haven, Connecticut, to Brooklyn 18 years ago, says that “after a three- to four-year breathing spell, the big up-zoning of Williamsburg is weakening the web of different shops we work with and support. In one efficient local trip, I could go from the metal spinner to the lacquer finisher with a stop at my supplier.” So far, at least five firms she worked with have been priced out and left town.

...Given the impor­tance green-building experts place on “embodied energy,” it’s curious that the industry standard barely acknowledges preservation. LEED for Existing Buildings emphasizes main­ten­ance and upgrade but not restoration; LEED for New Construction awards just three points out of 69 for “building reuse,” with all sorts of caveats attached. In contrast, providing bike racks and access to public transit earns one point for each. No penalties accrue for demolishing a viable structure and sending it to a landfill. You even get points for recycling elements from that lost building. Mayors and governors around the country are appointing commissions to develop sustainable policies, but they’re doing it with little or no in-put from preservation leaders. New York’s PlaNYC 2030 is silent on preservation and merely asserts that the city “will seek to adapt unused schools, hospitals, and other outdated municipal sites for productive new housing.” Where’s the commitment to leaving viable buildings out of landfills? Local and state governments are not entirely to blame here since the environmental movement has been slow to recognize the value of building conservation and preservation.

Kunstler on local materials

James Howard Kunstler, known for jeremiads about "Peak Oil," writes an essay headlined Going Local: When oil becomes scarce, our current way of life will become obsolete, noting:
A reality-based view of all this suggests that localism and green economic practices will be taken up more broadly and earnestly only when we don’t have a choice about it and can no longer manage our bad old ways. My serene personal conviction is that we are much closer to reaching that point than most Americans realize.

...What’s roiling backstage, itching to shove climate change out of the spotlight, is Peak Oil, which is currently understood poorly at best by the public. For one thing, it’s not about running out of oil. It’s about the complex systems we depend on for everyday life in this country becoming unstable and failing, as we enter the slippery slope of global oil depletion—a point that we arguably are already at. By “complex systems” I mean the way we produce our food (oil-reliant agribusiness), the way we do commerce (Wal-Mart et al.), the way we do transportation (extreme car dependency), the way we do finance (Ponzi-style), and so on.

...Living much more locally will increasingly be the only choice. We are utterly unprepared. We’ll have to grow food differently, at a smaller scale, closer to home, with fewer oil-and-gas-based “inputs.” It will surely require more human attention. National-chain discount shopping will shut down as its economies of scale dissolve and formulas like the “warehouse on wheels” and just-in-time inventory lose viability. Happy motoring will fade into memory, and the entire suburban equation will wilt along with it. And just about everything else you can name, from centralized high schools to professional sports, will be cruelly affected by problems of scale and energy.

...Our big cities will contract, not grow. The fortunate ones will densify at their old centers and waterfronts, but overall the trend will be severe shrinkage, really a reversal of the 200-year-long demographic movement of people from farms and small towns to megacities. (Places overburdened with skyscrapers will prove to be exceptionally troubled. The skyscraper is an endangered species that will, like the Baluchitherium of yore, soon go extinct.) In my opinion the overall trend will benefit the smaller cities and towns, but only those that can maintain a relationship with productive farming hinterlands or trade via water.

...I happen to believe that our zoning laws and land-use codes are unreformable. Instead, they will simply be ignored. We’ll return to traditional modes of inhabiting the landscape by default because we’ll no longer have the choice of doing it twentieth-century style. We’ll discover the hard way that the New Urbanists won that argument. It will just not be called “New” Urbanism anymore because it will no longer stand in opposition to other practical ideologies like suburbanism or Modernism. We’ll just have plain ­urbanism—and design disciplines to go with it. Architects ought to prepare for a return to traditional local materials. Modular snap-together panels and frame systems will be increasingly unavailable due to the prohibitive cost of fabrication as well as that of exotic metals such as Frank Gehry’s favorite, titanium. It is hard to say how severe this problem may become—a whole new industry will surely arise dedicated to the disassembly of old structures and salvaging of materials—but, personally, I’d say that we’re headed back to mostly masonry for the best new construction.

Even without the point made by Kunstler's jeremiad, AY may be part of Gehry's last round.

Documentary City of Water screens today; a provocative look at NYC's waterfront dilemmas

The half-hour documentary City of Water (video trailer and more here), produced by the Metropolitan Waterfront Alliance (MWA) and the Municipal Art Society (MAS), will be screened on Channel 13 today at 1:30 p.m. It's well worth a look for its portrait of an aspect of New York (especially Brooklyn) in rapid transition, its highlighting of the tensions between development and other waterfront uses, and its reminder of how we use and (too often) don't use an underrated asset.

The film features interviews with former Deputy Mayor for Economic Development and Rebuilding Daniel Doctoroff, U.S. Rep. Nydia Velazquez, MacArthur Prize winner Majora Carter, author Phillip Lopate, Sandy Hook Pilots Captain Andrew McGovern, among others and includes footage from Jamaica Bay, the Brooklyn Navy Yard, and many other places on the waterfront, as the promotional material states.

Doctoroff, Mayor Bloomberg's point man for the Olympics bid and other ambitious plans, is, relatively speaking, the "bad guy" in the film, though he acquits himself reasonably well, leaving viewers with an appetite for further drill-down reporting on the contours of specific controversies.

(There will be a panel discussion on the future of the East River waterfront, moderated by Roland Lewis, President and CEO of the MWA, on May 6 at the Museum of the City of New York. Scroll to bottom for details.)

The changing city

Early on in the film, Doctoroff sets the stage, explaining, "The city was a city of a working waterfront. Gradually, of course, the port function, as well as the industries that grew up around them, were driven away by global forces. There's very little that, in our view, is more important than reclaiming that waterfront. We have a moment in time when we think we can do it politically. We are seizing it with a fury that is uncharacteristic for New York development. This is a major, major effort to open the waterfront to the people of New York City."

Note that it wasn't simply global forces that drove the port from city limits; as Marshall Berman explains in New York Calling, it was also local political decisionmaking.

Doctoroff's clear counterpoint comes from Velazquez, who represents Red Hook, among other areas: "There is this rush from the part of the government to 'reclaim' the waterfront. But we sometimes do not understand what they mean by reclaiming the waterfront. What we see is building something at the expense of something else. Destroying one part at the expense of the other."

Well, change often requires such tradeoffs; the question is how wise they are.

Looking at Brooklyn

Doctoroff points to the place of greatest change: "Look for example at Brooklyn, where almost every inch of the Brooklyn waterfront, right now is undergoing some sort of transformation. I would suggest that, within ten years, almost none of it would be recognizable."

Indeed, the camera at one point sweeps past the Williamsburg Bridge and the shuttered Domino Sugar Factory; the film doesn't have time to explain the massive New Domino plan to bring some 2200 apartments to an 11-acre site encompassing former Domino property. One selling point for the project, by the way, is the provision of public access to the waterfront.

Velazquez gets a response: "I do not know how New York City can survive just by building luxury buildings everywhere. We need to diversify our waterfront. We need to have a waterfront that will allow for the different stakeholders to be part of it. It is so important that we educate our public, because once it's done, that will be it. The waterfront will be gone."

The political grease that has helped ease luxury development on the waterfront in Williamsburg and Greenpoint has been the provision of a bonus for affordable housing, and the New Domino developers seek a rezoning for their project that would offer a similar tradeoff. But Velazquez was talking more about jobs than affordable housing.

Later in the documentary, she says, "The communities, they are the experts." That actually suggests a tension: sure, communities should be consulted, but how to balance community input with issues of city-wide importance? We're still working on that.

What went wrong

The lack of access to the waterfront derives from the city's history. As a manufacturing city, New York needed the waterfront for factories. The waterways, we're told, were the "superhighways" of their time. And master builder Robert Moses, as Doctoroff reminds us, built highways around the edge of the city, further cutting off access even as industry declined.

So Doctoroff tells us: "The nostalgia for the port, the nostalgia for manufacturing along the waterfront, is gone. And what's left are hulking warehouses and rotting piers that could be a real asset when we're growing very rapidly. So we have an imperative to actually find places for people to live and, also at the same time, to give them places for recreation."

Staying "maritime-specific"

The earthy McGovern provides a bit of a corrective: "The city of New York, especially Manhattan, has forgotten about the port, forgotten about how vibrant this port still is. And unfortunately, they don't know the importance of the marine transportation system to their lives. The goods actually go in now to the large terminals that are mostly based in New Jersey. But it is still one operation. This port needs a very large support arm. That arm is based almost entirely within the city of New York. Those are the tugboats, the barge companies, and the repair facilities.

Velazquez chimes in: "Throughout the history of New York City, it has been a working waterfront. There are meaningful jobs and blue collar jobs that should and must be protected."

McGovern adds context: "There's a lot of areas within this port that are not viable to support the maritime industry. Those areas everybody's more willing to give over to recreation, parkland, housing. Not a problem. There are certain areas that need to stay maritime-specific. Once it reverts to a different use, we will never get it back. The port will die. For instance, we have lost of one of our repair facilities to a box store. We have a backlog in this port, last I heard, of about two years on getting into the remaining repair facilities. That repair facility was greatly needed."

After all, as he explains, without the working waterfront, the city couldn't function, as roads would become crowded with trucks and air quality would suffer.

That "box store" he mentioned almost surely is Ikea in Red Hook, which filled in a valuable graving dock for a parking lot, even though alternative plans were suggested. (Photo from the MAS's Save Brooklyn's Industrial Heritage page.)

Finding the balance

Doctoroff sounds reasonable enough: "I don't think the working waterfront is doomed. I think it's future is just limited. Land is our most constrained resource. We'll have that working waterfront where it makes financial and spatial sense. Where it doesn't, we've gotta let it go."

And so we see visions of towers and esplanades. But Lopate, author of Waterfront: A Walk Around Manhattan (and a member of Develop Don't Destroy Brooklyn's Advisory Board), warns that "humongous towers" don't provide real interaction between the waterfront and the street. He criticizes Battery Park City as feeling "like a somewhat suburban office park" (even though it's considered a better example of urban planning than, say, AY) and says Hudson River Park is more a backdrop for development than anything else.

New parks

The film describes two heartening case studies in which communities prevailed over unwise plans, though it may be that political forces have further shifted. Residents on the east side of Manhattan beat back Riverwalk, a project that would've brought sterile towers to the waterfront, and turned a garbage-strewn zone into an "environmental theme park," explains Joy Garland.

In the South Bronx, the lush green grass of Hunts Point Riverside Park covers a lot once held 10,000 discarded tires. Majora Carter, founder of Sustainable South Bronx (and Doctoroff antagonist in the post-Moses debate), reminds viewers of the old saying, "The community doesn't plan to fail; they fail to plan."

It was challenging, she said, to ask residents of the impoverished community to dream of a better future, but they did--and the result is an oasis in a neighborhood still seen as a dumping ground and one suffering from an enormous amount of truck traffic.

Getting our feet wet

Perhaps the most intriguing segments of the film bring us boaters, swimmers, and others who treat the waterfront not as a scenic backdrop but an asset in which we must immerse ourselves.
The notion of the "esplanade" only goes so far, says sailor and sociologist William Kornblum. At South Cove of Battery Park City, he reminds us, rescue workers on 9/11 had to use acetylene torches to cut through fences to get people into boats. He calls the incident emblematic of how planners allow people to the edge of the waterfront but keep them away.

Cathy Drew, founder of the River Project, drily explains how the easiest solution is to build a wall to separate land from water: "Engineers like that, and lawyers like that, and therefore developers like that."

What next

Rohit Aggarwala, director of the Mayor's Office of Long-Term Planning and Sustainability, talks about how we need a better transportation system and to beef up our capacity to handle CSOs, the combined sewer overflows that release untreated sewage after heavy rains. He suggests that the city's shellfish resources could also play a part in cleaning up the water.

Drew asserts: "New development should be linked to the capacity of our infrastructure to support it. And all of our treatment plants are already over capacity. As a society, we would want more sewage treatment plants, but no one wants it in their backyard."

(Note that a report prepared for Forest City Ratner and part of the Final Environmental Impact Statement asserts that, thanks to stormwater detention and water conservation/reuse, AY "would result in a net decrease in CSO volumes to the Gowanus Canal and a minimal increase in CSOs to the East River." The state review finds "no significant impacts;" community critics disagreed.)

Velazquez suggests "a sound, balanced planning process for the waterfront." Lopate posits creative ideas to bring people to the waterfront, such as a nightclub, movie theater, or even casino at a dock.

One of the more delightful scenes in the film shows kids from the South Bronx rowing their way around the water. And boater Erik Baard gets the last word, reminding us that the waterfront is "our wilderness" in a city where there's never enough parkland. "It should be a wonderful smorgasboard, y'know, of water activity," he states. "It should be something as diverse as New York is."

Balance possible?

Co-director Jasper Goldman of the MAS appeared on the Brian Lehrer Show in January to discuss the film. The host asked him, "So, is this mixed use that you advocate possible? Can we walk the line between wealthy residential waterfront development and keeping New York a commercial port city and using the waterfront for public recreation as well?"

Goldman responded, "Absolutely… The waterfront is, firstly, enormous. There's 578 miles of waterfront. So it's a very big waterfront. We really can have a diverse harbor where we can have it all... We can keep our port function vibrant, but we also can also have plenty of space for housing, for parkland. Really, the important thing is for New Yorkers to get involved… That's why [we] made this film… If we don't, we may end up with something mediocre. This is a tremendous opportunity, but we really need to take it and not let it slip by."

(Loren Talbot is the other co-director.)

MCNY program

On Tuesday, May 6, at 6:30 PM, the Museum of the City of New York will host a panel titled "The East Side of the East River Waterfront: Transforming the View." Readers of this blog can get the member discount ($5) if they mention "Atlantic Yards Report" while reserving.

The description:
The development of the Brooklyn and Queens East River waterfront is underway. Learn about plans to transform former industrial sites to beaches, parks, promenades, and housing. How will infrastructure and transportation improvements meet the demand created by business and residential development? Will there be true waterfront access or “esplanadia”? How will neighborhoods that have always mixed manufacturing and affordable residences survive? Roland Lewis, President and CEO of Metropolitan Waterfront Alliance (MWA), will moderate a discussion with Gayle Baron, President of the Long Island City Business Development Corporation and Executive Director of the LIC Business Improvement District; Tom Fox, President and CEO, New York Water Taxi; Milton Puryear, Co-founder, Brooklyn Greenway Initiative; and Phaedra Thomas, Executive Director, Southwest Brooklyn Industrial Development Corporation. Co-sponsored by the MWA. Reservations required. $5 Museum members, seniors, and students; $9 general public.

Three City Council members call for moratorium, but not a commitment to build project

So, did City Council Members Letitia James, Bill de Blasio, and David Yassky all agree, as the Brooklyn Paper reported, that "construction at the Atlantic Yards site must be blocked until developer Bruce Ratner commits — in writing — to building the full state-approved project."

Not quite. The letter to Gov. David Paterson calls for more information to be shared, not a commitment, and notes that signatories have divergent views.

The letter

The letter:
We write to express profound concern regarding recent reports that the residential and office towers in the Atlantic Yards project, including thousands of units of affordable housing, may be indefinitely delayed, while demolitions in anticipation of this construction continue to occur. We urgently request information regarding the revised project plan and timetable, and respectfully ask that you halt demolitions until such information is made available and reviewed by local elected officials.

According to the funding agreement between Forest City Ratner Companies and the Empire State Development Corporation, there is no commitment for the commencement of the construction for Phase II, and we further understand that the timetable for construction of Phase I may be delayed beyond the original estimate. Yet without such commitments, construction is moving forward, causing serious disruption to our communities and potentially leaving them in an empty, blighted state for an unknown number of years to come.
It is imperative that the public be made aware of the anticipated execution dates for the entirety Phase I and Phase II, including all promised units of affordable housing. On behalf of our constituents, we request that you immediately (i) inform the community of any changes to the General Project Plan concerning the plans for building the office and residential towers, and any impact this will have on the number of affordable housing units to be included in the project, (ii) provide the public with a projected timetable for the commencement of construction of Phases I and II, and (iii) immediately cease demolition activity until this information is shared with the public.

We note that the signatories to this letter hold a variety of views on the Atlantic Yards project overall, and may have other concerns beyond the scope of this letter. All of us, however, believe strongly that the requested information should be provided to the public as soon as possible.

FCR, in e-newsletter, anxiously suggests readers "reach out" to elected officials

Today's New York Times editorial prompted Forest City Ratner to send out an e-newsletter quoting the newspaper's brief comment on the project and adding some talking points:
For our part, despite the changing economy, Forest City Ratner remains committed to delivering the entire project, including all of the 2,250 units of affordable housing.
(Emphasis added)

Keep in mind that when the developer uses the term "committed" it doesn't necessarily mean a firm timetable. It was Chuck Ratner, CEO of parent Forest City Enterprises, who said in March 2007, "We remain committed to our goal of opening the arena in time for the 2009-2010 NBA basketball season.”

Now, of course, the stated goal is 2010, while 2011 is the likely best-case scenario. (At right, screenshot from Atlantic Yards home page.)

Demolition or construction?

Today's message continues:
As it relates to construction, we began work on the site over a year ago, and thus far 50% of the structures on the site have been taken down. We have contracted over $42 million worth of work, with over 45% going to women- and minority-owned business. On the legal front, we had three key victories earlier this year, and in total we have had 18 court decisions in our favor.

No construction of the project has begun. The Empire State Development Corporation's "Construction Update" refers to "construction activities" such as demolition and abatement.

Note that the $42 million is less than the $55 million in public funds already distributed. As for "court decisions," that's a creative total, since the opposition in the eminent domain case, for example, won some of its (less dispositive) arguments, such as getting the federal judge to agree not to have the court abstain from the case.

Time to reach out

Today's message concludes:
Significant progress is being made each day on the project, and Atlantic Yards and all of its affordable housing as well as thousands of jobs will be a reality for Brooklyn. We encourage you to reach out to your local elected officials and remind them of the importance of Atlantic Yards.

To me, that suggests some anxiety about how the "done deal" Atlantic Yards will be treated in the political process as it goes forward. Three City Council Members--Bill de Blasio, David Yassky, and Letitia James--have called for a moratorium on demolitions, as the Brooklyn Paper reported this week.

If that puts the developer on the defensive somewhat, surely a bigger challenge--and a reason to reach out to elected officials--is the developer's stated desire for more subsidies to complete the project.

Reading between the lines of the Times editorial

It's not exactly what Develop Don't Destroy Brooklyn was advocating, but a round-up editorial in the New York Times today, headlined Construction and Hard Times, asserts
Work is slowing, stalling or stopped altogether on too many of the projects we hoped would transform some of the bleakest sections of the city.
(Emphasis added)

I'm not sure that the Atlantic Yards site (or even Penn Station) would qualify as "the bleakest," but the Times editorialist apparently hasn't been checking the un-bleak real estate market in Prospect Heights.

The AY mention

The editorial states:
Atlantic Yards The Nets arena appears to be moving ahead, but the centerpiece Miss Brooklyn building designed by Frank Gehry is likely to be delayed. A strong state hand could ensure that the project — with adequate lower-income housing — survives hard times.

Does "strong state hand" mean that the state should supply the mystery anchor tenant for Miss Brooklyn? Does it mean that the state should prioritize subsidies for the affordable housing (most of which would be "lower-income" than market but certainly not low-income) promised at Atlantic Yards? Do the flexible deadlines already established--6+ years to build the arena, 12+ years for Phase 1--suggest a strong hand?

Update

See how the editorial already made FCR's AY e-newsletter.

And NoLand Grab and DDDB remind us that, oh yeah, the parent New York Times Company is the developer's business partner. I'm so used to the editorial page's cognitive dissonance that I sometimes forget.

The six-year arena timetable surfaced in December 2006

I can't believe I and others missed it, but the news that Forest City Ratner has 6+ years to build the arena--six years after the end of litigation and delivery of the project site via eminent domain--wasn't exactly new.

It was on page 28 of the Modified General Project Plan (Part 2), issued and approved by the Empire State Development Corporation (ESDC) on 12/8/06. (Click to enlarge.) It was not, however, in the General Project Plan issued in July 2006, which got a lot more scrutiny.

However, the other parts of the timetable--that the developer has 12+ years to build Phase 1 and an unspecified time to build Phase 2--were, indeed, first revealed in the recently-surfaced AY State Funding Agreement.

Delays from the start

This much is clear: the ESDC, even while approving a plan "anticipated" to be completed in ten years, allowed for six years--including four years of delay resulting from force majeure events or significant financing snags--to build the arena.

So former FCR executive Jim Stuckey's affidavit filed on 4/27/07 in the environmental lawsuit, now on appeal, should be taken with a grain of salt. The petitioners had challenged the project's ten-year timetable, saying the state's environmental review lowballed the impacts of a much longer project.

Delays a "theory"?

Stuckey scoffed at the petitioners' argument, saying that they "primarily base their theory" on a statement made by Forest City Enterprises CEO Chuck Ratner, who told investment analysts the project would take 15 years to build and assented to a statement that the arena would open in 2010.

Stuckey pointed out that Ratner two days later clarified his statement, insisting that the 15-year timetable referred to the elapsed time between project conception and project completion, and that the developer was "committed" (a word with built-in flexibility) to opening the arena in time for the 2009-10 basketball season.

I found Ratner's clarification not so credible. A year later, that timetable is in tatters. Forest City Ratner must be thankful it negotiated some slack.

As the case challenging the environmental review is on appeal, it'll be interesting to see if the ESDC is challenged on harmonizing its prediction of a ten-year buildout for 17 buildings with the slack it granted the arena (and, by implication, the rest of the project). It may be legal. But it certainly wasn't very transparent.

In Harlem and Coney Island, major compromises before zoning approval

Yesterday the New York Times reported that the Bloomberg administration has revised its redevelopment plan for Coney Island to get current landowners and elected officials onboard.

On Wednesday, the Times reported that Harlem's three City Council members had agreed to a compromise plan that would lower the height of new buildings allowed under a rezoning, increased the amount of affordable housing, and provide some help to displaced businesses.

Fair deals? I can't be sure. (The Brooklyn Paper praised the Coney compromise. Housing activist Phil DePaolo criticized the Harlem move.) But it's notable that the political process--the need to get a rezoning through City Council--forced changes, in both cases much larger compromises than, say, the 6-8% scaleback proffered (and overplayed by the New York Times) before the Atlantic Yards project received state approval.

AY compromise?

Were larger compromises possible regarding Atlantic Yards, given that a good chunk of local residents adamantly oppose an arena at the site? Maybe, maybe not. (Also, I should add, only the state could override so many aspects of zoning.) And Forest City Ratner "negotiated" only marginal changes, such as promising 200 on-site affordable ownership units--all subject to the availability of subsidies.

But it's clear that the city's willingness to let the Empire State Development Corporation take the lead removed leverage and input from the political process, which could have led to a different fate for the Metropolitan Transportation Authority's Vanderbilt Yard.

From the perspective of project supporters, that may have been necessary. From the perspective of project opponents and critics, that's why Kent Barwick of the Municipal Art Society suggested AY might be this generation's Penn Station.

High crime in the footprint? Officers head, instead, to the mall

Remember the Empire State Development Corporation's Blight Study? Its claims of high crime in the Atlantic Yards footprint were dubious, as I wrote in July 2006, and Supreme Court Justice Joan Madden, in her January dismissal of the case challenging the Atlantic Yards environmental review, punted on assessing the issue.

Well, now comes a piece of evidence that further challenges the study's claims. The Daily News, in a story published Tuesday on a "crime wave" in Clinton Hill, reports:
The need for a police presence at the Atlantic Terminal Mall is also cutting into the ranks of officers policing the community, the source said.

Not the malls

Remember, the AY footprint contains sectors from three separate precincts, and the only sector where a rise in crime had been seen--the source of the Blight Study's sweeping conclusions--was Sector 88E, shown at right. (ESDC graphic adapted by Lumi Rolley of NoLandGrab; click to enlarge.)

The report tried to assess whether Forest City Ratner's two malls, in the western end of Sector 88E above Atlantic Avenue and thus the footprint, contribute to crime:
The Atlantic Center and Atlantic Terminal shopping centers are located immediately north of the project site, also within the boundaries of Sector 88E. In an effort to determine whether a large proportion of crimes reported for Sector 88E might have occurred on the Atlantic Center/Atlantic Terminal premises rather than on the project site, crime data were obtained from the security staff at the shopping centers.
Based on this data, which reflects incidents occurring within the Atlantic Center and Atlantic Terminal shopping and parking areas as well as on the surrounding sidewalks, it is unlikely that a large proportion of crimes in sector 88E occurred on the Atlantic Center or Atlantic Terminal premises. For example, while there were 39 robberies in sector 88E in 2005, the shopping center security records indicate that no robberies occurred that year at Atlantic Center or Atlantic Terminal. Similarly, while there were 115 grand larceny crimes reported for sector 88E in 2005, the shopping center security force recorded only one incident of larceny that same year. Although crimes catalogued by the Atlantic Center and Atlantic Terminal security staff are not necessarily the same as those catalogued by the NYPD, the relatively low number of crimes reported at the shopping centers indicates that the high crime rate in sector 88E is more likely a result of crimes occurring on the project site than in Atlantic Center or Atlantic Terminal.
(Emphasis added)

Alternative explanations

As I noted, there are other populated areas in Sector 88E, including the city's tallest public housing tower. Meanwhile, the project site in Sector 88E had businesses but no housing. So the attempt to pin the crimes on the project site, as opposed to the malls or the other segments of Sector 88E, was unfounded.

And now, thanks to that police source, we learn that the police are concentrating on a mall that gets a lot of foot traffic, which certainly makes sense.

Could it be that mall security staff, whose records indicate that only one incident of grand larceny--theft of property of more than $250 in value--occurred during a year, according to the Blight Study, might be fudging the books?

They certainly seem to be cracking down on petit larceny, at least according to a much-blogged recent incident at Atlantic Terminal.

"Street Fight," Sharpe James, and some Newark echoes in Brooklyn

Even before the fraud conviction yesterday of former Newark Mayor Sharpe James, Marshall Curry's riveting 2005 documentary Street Fight, about Council Member Cory Booker's 2002 challenge to longtime mayoral incumbent James, was essential viewing--and with some implications for Atlantic Yards watchers, especially regarding the performance of the press.

Now that Booker was elected in 2006 and James convicted, Curry's non-neutral but essentially honest investigation reminds us of the inability of the mainstream press, too often wedded to "he said, she said" modes of reporting, to convey the sleaziness of the James administration.

He captures James in a baldfaced lie (see screenshot below), claiming he has "a volunteer army versus a paid army" (actually, the James "volunteers" admit on camera that they're paid and from out of state), films city employees tearing down Booker's campaign signs, and several times experiences intimidation by James's security detail.

The press as referee

Asked in an interview posted on Alternet about how candidates get away with such bad behavior, Curry responded:
One thing that frustrated me so much in both the Newark election and the last presidential election is the mainstream media tries to cover elections in a way that they consider to be fair but that in fact is a distortion of reality. They try to say, "Well, George Bush said this, John Kerry said this" or "Cory Booker said this, Sharpe James said this." And they don't analyze whether one side is telling the truth. They just allow themselves to be mouthpieces for the two campaigns. And I think that they do that because that is what the audience assumes is fair. In fact, I think the media needs to be like a referee. A good referee doesn't call the same number of fouls on both sides; a good referee calls fouls when there are fouls.
(Emphases added)

The real estate industry

In one scene in the film, a radio interviewer cites James's accusations of Booker's alliances with "far-right" Republicans like Oklahoma Rep. J.C. Watts. "I've never met J.C Watts," Booker responds. "I've been lifelong Democrat. And suddenly, here we are, wasting time, talking about Sharpe James's accusations."

The interviewer tells Booker that people are scared of his "broad-based support," which includes out-of-state contributions.

Booker responds, "This is what is almost comical... The majority of Sharpe James's supporters are developers and people that have city contracts. And the majority of those don't live in the city of Newark."

Politics as sport

In one important sequence, Curry tries to film a mayoral debate, but police won't let him film it; instead, he tapes the audio. A fracas breaks out. James accuses a Booker supporter of being a "terrorist." Police pull the man into a room, but lawyers for Booker campaign argue until he's released. James lunges at lawyers; his supporters hold him back.

A Booker supporter taunts James, and gets trash-talked in turn by James's supporters. A policeman from the mayor's security team breaks the microphone from Curry's camera. Reporters gather around to hear the "terrorist" explain what happened.

Next we see Booker on the phone, speaking to a reporter: "You saw how I comported myself, and I really hope that you write the truth--this is how Cory behaved, this is how Sharpe James behaved."

Curry's voiceover, however, is somber: "The Booker team is struggling to get the press to show more outrage. But so much of the reporting just treats the election like a sport. They call it rough-and-tumble politics, as if Newark were a crazy regime on the other side of the globe, rather than an American city, just 12 miles from Manhattan."

The Sharpton connection

The generational division in African-American politics is one theme in the film. We see academic Cornel West and filmmaker Spike Lee backing Booker, while Jesse Jackson and Al Sharpton campaign for James, who repeatedly insisted that Booker, who grew up in the middle-class suburbs, was insufficiently black.

(Booker lived in a city housing project in his council district while James collected a second paycheck as a state senator, surely muddying the issue.)

The James connection is one of several that reminds us that Sharpton's political opinions should be taken with some skepticism.

The film premiered 7/5/05 (though it didn't appear on DVD until the end of 2006). A New York Times City Hall reporter, who presumably should have been familiar with a tough film on a nearby mayoralty, thought the news that Sharpton criticized Ferrer more important than Ferrer's public announcement that he opposed Atlantic Yards.

So a 10/29/05 headline in the Times read, Ferrer Is Chided Over Atlantic Yards, allowing Sharpton to wrest the narrative from Ferrer.

The media and Newark, the media and Brooklyn

While Brooklyn is famously undercovered, Curry suggested that Newark suffers as well, in an interview for P.O.V.:
Because it's so close to New York City, Newark falls in a media shadow, really. New York City sucks up most of the television press in the area, and most of the newspapers' scrutiny. Because of the longstanding lack of scrutiny, a lot of problems have developed. I'm hoping this film will help to shine a light on some of those problems and will get people involved to take some action.

While the Star-Ledger has dropped "Newark" from its name, Newark does have its own newspaper, sort of. And it has a city government. So there are probably more mainstream news reporters covering Newark than Brooklyn.

Then again, there are a lot more citizen journalists, independent journalists, activists, and bloggers in Brooklyn keeping the press on their toes.

Time for a Times editorial?

Develop Don't Destroy Brooklyn makes a reasonable case for the New York Times to publish an editorial on Atlantic Yards--after all, there's been some dramatic news and lots of discussion lately.

However, given that several of the stories cited--including the desire for more public subsidies, criticism from a City Council Member, and an attempt to assess the public cost and subsidies--haven't appeared in the Times at all, I'd suggest that more reporting is the first order of business.

Also, how about reporting on the long leash the developer has to build the project, according to the State Funding Agreement? How about a rigorous attempt to assess the public costs and subsidies for the project, taking off from the New York Post article that got a lot of tongues wagging?

The cost of inattention

It's clear now that the Times disserved readers by not paying more attention to Atlantic Yards after the project was approved in December 2006.

As for the editorial page, in December 2006, I pointed out how the Times was silent when the key Public Authorities Control Board vote approached, even as other news outlets weighed in. The Times editorial page, I surmised, was caught between its publisher's support for developer Forest City Ratner and the fruits of its own reporting, which showed Empire State Development Corporation Chairman Charles Gargano misspeaking about eminent domain.

Some more reporting now might lead to similar gridlock. (The Times editorial page has practice with cognitive dissonance, little more than two weeks ago hailing a "real bidding process" for the Hudson Yards.) After all, the editorial page "reflects the spirit of the Times" and the opinion of the publisher, as editorial writer Carolyn Curiel said last year.

But the editorial page and the newsroom are separate. And there's lots of news to report about AY.

Answers About Brooklyn Architecture, criticism of AY

From the New York Times's CityRoom blog, under the rubric Answers About Brooklyn Architectureg, the first set of answers from Diana Lind, the author of “Brooklyn Modern: Architecture, Interiors & Design,” who is taking questions from readers.

A reader named Matt asked:
Speaking of Atlantic Yards, what does Ms. Lind think of this mega-development, and its potential effects on Brooklyn life?

Lind responded:
Living in Ft. Greene half a block from Atlantic Avenue, I’ve thought a lot about the Atlantic Yards project and its potential impact on life in Brooklyn. Certainly the site merits some kind of development, but I’m opposed to the Ratner plan as it stands now for a few key reasons. I take umbrage at the project’s vast, uninterrupted scale; its street closures; its miserable sense of public space (when was the last time you threw a frisbee on a private building’s lawn?); and most recently, revelations of its more than 2 billion dollars worth of tax write offs and subsidies from the government (according to the NY Post). Though the project has touted the fact that it’s going to create jobs and housing, the scheme of using public money to finance this endeavor sounds like robbing Peter and Paul to pay Mary (sorry, the Pope’s in town).

But I also have aesthetic qualms with the project. I don’t think any one architect should be in charge of designing 22 acres of any city. In a March 21st piece by New York Times critic Nicolai Ouroussoff, the project’s uncertain status is lamented. Ourousoff points to the importance of great planning projects such as Rockefeller Center (roughly the same size as Atlantic Yards). But Rockefeller Center was developed by a team of architects; Atlantic Yards will not be. Gehry is good at what he does, and as others have noted his voluptuous style would nicely contrast with the phallic bank building, but more than 7 million square feet of his outlandish style (of any architect’s style) starts to look pretty tacky and boring, no matter the context.

So, if the project goes ahead as it’s planned now, how this will affect life in Brooklyn? A lot. Irreversibly. It will complete Brooklyn’s transformation from a post-industrial residential borough to a city unto itself and will extend Downtown Brooklyn to Ft. Greene, Prospect Heights, and Boerum Hill.

Spending time in Brooklyn now, one senses the borough’s promise and mutability. When and if Atlantic Yards is completed, I think many people will feel an enormous opportunity was lost on a not particularly innovative project. If I were in charge of the development site, I’d scrap the plan, build a platform over the railyards, and auction off small parcels of the site to varied developers, cultural organizations, and schools. The diversity of approaches to the parcels would mimic the city’s naturally haphazard development process and allow for more community involvement.

That sounds like an endorsement of something like the UNITY plan. Also, implicitly, Lind doesn't believe in an arena.

Reading between the lines: Ratner may seek $163M (or more) in subsidies for the railyard

What did Chuck Ratner, president of Forest City Enterprises (FCE), mean when he told investment analysts two weeks ago that "we still need more" subsidies for Atlantic Yards?

I can't be sure, but documents submitted by FCE's subsidiary Forest City Ratner (FCR) hint that the developer might seek reimbursement for $163 million (likely more) spent on "extraordinary infrastructure costs"--mainly the platform, but also including planned open space--at the Metropolitan Transportation Authority's Vanderbilt Yard.

Why do I draw that conclusion? Because FCR once claimed that it was absorbing those extraordinary infrastructure costs, part of its investment in the project.

In a court document, FCR dropped that claim. Thus it's reasonable to speculate that the developer will seek reimbursement from the public.

The MTA bid

Let's look at the developer's 2005 bid for the Vanderbilt Yard, a document included last year as part of the litigation over the Atlantic Yards environmental review.

In the document submitted to the Metropolitan Transportation Authority, FCR estimated the total value of the bid at $492.4 million. (Click to enlarge.)

That included $182 million for a new railyard, $20 million for environmental remediation, $25.4 million in compensation for increased operating costs, $29 million in mass transit improvements, and $23 million in sales tax revenue. That's $279.4 million. With $50 million in cash (the original proposal), the total reaches $329.4 million.

Then FCR added $163 million in "extraordinary infrastructure costs incurred by the developer to build on the MTA parcels," including a new platform and public open space. The total: $492.4 million.

Given that FCR eventually upped its cash bid to $100 million, the total value might be adjusted to $542.4 million.

What they told the court

However, that $542.4 million figure was not to be found in former FCR executive Jim Stuckey's affidavit filed on 4/27/07 in the same lawsuit.

The affidavit omits the $163 million.

Stuckey stated: While petitioners are correct that FCRC's bid contained an offer of $100 million in cash while Extell's bid offered the MTA $150 million in cash, the petition fails to advise the Court that FCRC's bid also offered to (1) build a new Vanderbilt yard for the MTA at an estimated cost to FCRC of $182 million, (2) conduct environmental remediation and clean-up of the MTA's property at an estimated cost to FCRC of $20 million, (3) compensate MTA for increased operating costs that had an estimated present value of $25,400,000, (4) construct additional mass transit improvements relating to the nearby subway station at an estimated cost to FCRC of $29,000,000, and (5) share with the MTA sales tax revenues from the project that had an estimated present value of $23,000,000 (see Ex. H, at p. 2.1). FCRC's bid thus reasonably could be valued at $379.4 million dollars.

(Was Extell's bid a better deal, as Develop Don't Destroy Brooklyn contends, or was Stuckey correct? Stay tuned for another look.)

Doing the math

Given that the $379.4 million claim is $163 million short of the total that assumed "extraordinary infrastructure costs," it's reasonable to conclude that FCR no longer considers itself contributing that $163 million total.

Indeed, given the huge increase in construction costs--the cost of the arena has more than doubled, from $435 million to $950 million since 2005--it's likely that $163 million figure has grown significantly.

"Blank check"

Why did FCR give up the claim? (Could it simply have been an oversight? Not impossible, but I doubt it.)

I don't know, but it could be because Develop Don't Destroy Brooklyn (DDDB) in 2005 blew the whistle on the "extraordinary infrastructure costs," pointing out that the term appears in the Atlantic Yards Memorandum of Understanding (MOU) signed by the city and state, leaving room for further reimbursement by public parties.

Both the city and state, according to the MOU (right), agreed to “consider making additional contributions for extraordinary infrastructure costs relating to the mixed-use development on the Project Site (excluding the Arena Building Site)."

DDDB calls this a “blank check.” Indeed, given the use of the term "extraordinary infrastructure costs" in both the MTA bid and the MOU, it's not hard to connect the dots.

More hints in the GPP

Some different language that also hints at a "blank check" appears on p. 27 of the Modified General Project Plan approved in December 2006 by the Empire State Development Corporation.

It defines advances of pledged State and City funds ($200 million at the time) under the Funding Agreements as "Additional Fundings" that would go to a variety of uses until the announced contributions are exhausted.

Then, the document continues:
In addition, Additional Fundings shall be made taking into account monies expended by FCRC, provided that (1) at no time will (i) the costs reimbursed to FCRC by the City and State, in the aggregate, exceed fifty percent (50%) of the total costs incurred and paid by FCRC, and (ii) the amounts funded by the State exceed the amounts funded by the City, and (2) such Additional Fundings shall be made upon other terms and conditions to be agreed upon by the parties.

In other words, the term "Additional Fundings" is first used as a definition for pledged contributions, then used as a definition for further new contributions.

If those contributions shall be made, as the document states, "taking into account monies expended by FCRC," then money spent on "extraordinary infrastructure" for the railyard seems the most obvious candidate.

De Blasio's (late) AY conversion and the need for oversight

City Council Member (and Brooklyn Borough President candidate) Bill de Blasio generated headlines yesterday on Brownstoner and the Gowanus Lounge--and then elsewhere--for blasting Forest City Ratner and declaring, according to Brownstoner, "I have been constantly disappointed in the lack of community involvement."

On GL, he was quoted as saying, "I've never seen something so fundamentally mishandled in terms of excluding the community."

Time for skepticism

I missed de Blasio's meet-up with Brooklyn bloggers Monday night--I was at a Municipal Art Society panel on planning--but I think a little skepticism is in order.

After all, he's long supported the project, despite expressing qualms. NoLandGrab noted yesterday that de Blasio was facing blowback for his support of the "toothless" Community Benefits Agreement.

As I wrote, after a long exchange with de Blasio at a meeting last fall, he sounded way out of touch when he said, “In retrospect, I don’t think anyone expected Forest City Ratner to be so untransparent.”

After all, as I noted, the developer has produced at least six disingenuous political brochures, launched the Brooklyn Standard “publication,” and required those selling property to sign gag orders.

As for de Blasio saying he wants "something in writing from Forest City Ratner to tell us if there has been a change and if there's been a change we need to revisit it," well, as noted on GL, the State Funding Agreement gives Ratner a lot of slack: 6+ years to build the arena, 12+ years to build Phase 1, and an unspecified amount of time to build the rest of the project.

[In an article on de Blasio's criticisms in today's Daily News, FCR spokesman Bruce Bender claims, without proof, "As the Council member knows, all of Atlantic Yards, including all of the affordable housing, will be built, and any delays in the construction phase will result in delays in delivering the thousands of units of affordable housing and thousands of jobs that Atlantic Yards will create."]

What next?

So what can de Blasio do beyond calling for a moratorium on demolitions, one that might have little effect?

Elected officials, including de Blasio, have called for a new governance structure to oversee the project. But a new governance structure can't get to the bottom of why the state (and city) have agreed to terms that give the developer a lot of flexibility.

Maybe lawmakers should hold some oversight hearings.

For public discussion of development, Brooklyn needs a venue

Why is it that some of the most important discussions about Brooklyn, notably Brooklyn developments, take place in Manhattan? Obviously, meetings of the City Council or the City Planning Commission are held in Manhattan, while official hearings in the land use review process are held reasonably near the place at issue, which means Brooklyn.

Leaders in Manhattan

Beyond that, however, there are several options for public discourse, and Manhattan-based institutions like the Museum of the City of New York (MCNY) or the Municipal Art Society (MAS), are the leaders in helping further such discourse.

Notably, several MAS panels associated with the Jane Jacobs exhibit last year had a strong Brooklyn focus. Last month, I visited MCNY, way up at Fifth Avenue and 104th Street, to hear a stimulating panel discussion about the future of Coney Island.

A MAS Planning Center Forum titled "David vs. Goliath" on May 14 will include Marshall Brown, the architect behind the UNITY Plan for the Vanderbilt Yard and Candace Carponter of the Council of Brooklyn Neighborhoods, a backer of the plan.

Where's Brooklyn?

Brooklyn institutions and Brooklyn venues should be hosting similar panels. Given the ferment about development--just yesterday the Gowanus Lounge reported on the founding of the South Brooklyn Neighborhood Alliance--Brooklyn needs a place where controversial issues can be ventilated publicly. After all, the frequent discourse that has Brooklyn neighborhoods designated the nation's "bloggiest" deserves to surface in real time.

There are places for discourse, among them the Brooklyn Historical Society, the Brooklyn Public Library, the Center for the Study of Brooklyn at Brooklyn College (and other academic institutions), and events sponsored by community boards, the Borough President, civic groups, and neighborhood groups like the Fort Greene Association and the Park Slope Civic Council. And Brooklyn Community Access Television (BCAT) produces a good number of public affairs shows.

However, Brooklyn, given its population of more than 2.5 million, would be the country's fourth-largest city if independent. It deserves its own equivalent of MAS or MCNY, just as it deserves much more press coverage.


Who will step up?

Can any of the Brooklyn groups step up? Maybe a consortium of organizations could take a closer look at development, or join up with a Manhattan-based organization like MAS or MCNY. One good venue might be the library's new, centrally-located auditorium, the Dweck Center.

(See the comments for another good candidate: the new home of the Brooklyn Center for the Urban Environment, or BCUE.)

West Side plans in disarray; what about AY?

Yesterday, in an article headlined West Side Redevelopment Plans in Disarray, the New York Times described a harsh reality that has some interesting echoes in Brooklyn:
Because of the economic downturn, logistical problems and, critics say, design flaws, the expansion of the Javits Center has died, the plan to rebuild Penn Station and the area around it is in jeopardy and there are deep questions about financing, public and private, to extend the subway or build over the railyards.
...But many urban planners, architects, community leaders and developers say the downturn may have a silver lining, providing an opportunity for the city to rethink and reconfigure sweeping proposals many of them had doubts about all along.

The article didn't mention Atlantic Yards, but there are some comparisons and contrasts worth considering. Yes, there are some definite differences between the West Side plans and Atlantic Yards, notably the selection of a developer.

In Brooklyn, the Times's 3/21/08 coverage of the Atlantic Yards stall quoted one opponent, but otherwise no urban planners, architects, or Community Board member. (The Times never quoted the expressions of opposition and concern filed by the three affected Community Boards during the AY environmental review.) Rather, the developer, Forest City Ratner, is in the driver's seat and got the last word.

Near the hub

Yes, the planners' suggestion that the city focus on developing around Penn Station is roughly analogous to building near the Atlantic Terminal transit hub--though hardly the entire AY plan.

But the alternatives suggested in the Times article--less ambitious plans, rezoning, focused public resources--are among those suggested in the AY discussion.

What to build, and who pays

Yesterday's warning:
“We clearly can’t afford to do everything,” said Robert D. Yaro, president of the Regional Plan Association, a nonprofit planning group. “The moment has arrived where we have to be really clear on what we want to build and how we’re going to pay for it.

The same question applies to Atlantic Yards, especially given the developer's stated goal of more subsidies.

The RPA has played a curious role in the AY debate, in 2006 endorsing the arena block yet offering more criticism than praise for the project as a whole and subsequently offering more criticism of the process.

Maybe it's time for RPA to take a closer look at Atlantic Yards.

No-risk arena: NY Post estimates "Net" loss of '$2B in taxes"

After a plethora of coverage that has largely left the funding Forest City Ratner's Atlantic Yards plan unquestioned, today comes an article in the New York Post that casts a critical eye on the funding, notably an apparent no-risk plan to build the arena.

And that critical eye is a tabloid one, making a sweet deal look even sweeter. Note that only the online version of the article contains the crucial news that state and city officials say it's too soon to comment on whether Forest City would get the increased subsidies it seeks.

The article, published on p. 19 of today's Post--way behind the Marilyn Monroe sex tape story and a Yankees story, which earned the cover--has the headline YOUR 'NET' LOSS, subtitled "$2B in taxes to Ratner," which isn't quite correct. (Click to enlarge.)

While the article states that the $4 billion plan is "in line to receive [updated] $2,157,260,000 worth of government subsidies," which means the public is in line to pay half of it, that deserves some caveats. First, there's a difference between direct subsidies and tax breaks, though they both add up to savings for the developer.

Total cost needs update

Second, the calculation of savings to the developer may be up to date, but the total cost of the plan is not. Nearly half of that $2.14 billion estimate is payments in lieu of taxes (PILOTs) that the developer would make to pay off the arena bond. While the cost of such payments has been updated to account for the current arena cost estimate of $950 million, the cost of the project as a whole has not been updated.

In other words, if the cost of the arena has grown by more than $300 million, from $637.2 million when the project was approved, so has the cost of the project as a whole. So the $2.14 billion estimate should be compared against a new estimate.

And an independent body should perform its own analysis. Indeed, some of the tax breaks do not directly offset the cost of the project.

Sweetheart deals

The article begins:
Developer Bruce Ratner's Atlantic Yards project in Brooklyn is boosted by so many sweetheart deals that the public stands to pay for more than half the cost of his controversial $4 billion plan, a Post analysis found.

Note that the "analysis" is not so much by the Post but by project critic Michael D.D. White.

More corporate welfare

The article continues:
The project - which would bring an NBA arena and 16 residential and office towers to Prospect Heights - is in line to receive at least [updated] $2,157,260,000 worth of government subsidies, according to project records and interviews with past and present state and city officials.

And the developer is gearing up to ask for even more corporate welfare.

The president of Ratner's parent company said in a conference call with investors last week that the project will "still need more" subsidies.

The state and city say Ratner has yet to ask for extra assistance, but the developer last month admitted that a sagging economy is holding up construction of the project's residential and office space.

As typical with the Post, it doesn't credit other news outlets for previous coverage; note that AYR last Monday reported on the developer's statement, made the previous Wednesday, about needing more subsidies.

No-risk arena

The article continues:
Among the biggest revelation of the Post analysis is what project skeptics have feared for years - that Ratner can build the planned 18,000-seat arena for his New Jersey Nets to move to with little financial risk.

It's not quite a Post analysis. Read on:
"The setup is basically like paying taxes on your home and then having the government use that money to help you pay off your mortgage," said Michael D.D. White, a former vice president and top lawyer for the state finance authorities.

White - who provided the newspaper with subsidy projections based on his own review of project documents --estimates that Ratner would save slightly over $1 billion in tax payments through a Payment in Lieu of Taxes deal with the state.

Under the deal, he said these payments would be "intercepted" and go directly towards settling debt service on state bonds to build an $950 million arena that Ratner will "all but own," with remaining cash going towards arena operating costs.

While the state will technically own the arena, Ratner under a cozy $1-a-year lease deal, will control it and all its potential profits.

This is an important point, one made previously by the Brooklyn Paper and on AYR but not prominently in a daily paper. As I wrote in January:
Moreover, the maximization of private participation in this instance arguably gives the developer the arena for free. Yes, tax-free bonds will be issued to build the arena, but FCR will pay off those bonds via Payments in Lieu of Taxes (PILOTs) to the local development corporation set up to nominally own the arena. (See page 6 of the Memorandum of Understanding between developer, city, and state.) The PILOT will not exceed the real estate taxes were the site not publicly-owned and tax-exempt. (See “R-TIFC-PILOT”.)

The IBO analysis

Note that the Independent Budget Office, in its September 2005 Fiscal Brief analyzing the economic impact of the arena, did not count the arena financing--or, at least, the vast majority of it--as a special benefit for Forest City Ratner, instead concluding:
IBO’s estimate of new property tax revenue lost to the arena PILOT does not include a loss of property taxes for the MTA land that would be part of the arena building foot print. The city currently receives no tax payment from the MTA for the rail yard because the MTA, like other state entities, is exempt from local property tax. Under the MTA’s Request for Proposals, any developer acquiring the development rights to the site would probably enter into a long-term lease, leaving the MTA in place as the owner. Therefore, the property would likely remain off the city’s tax roll, resulting in no impact on the city budget. Indeed, the MTA has an incentive to make a deal that maintains the tax exemption in order to maximize the price it receives for the development rights.

The IBO isn't quoted in today's article; indeed, the office's narrow task was to calculate the fiscal impact on the city, not the fiscal benefit to Forest City Ratner, two very different things.

But the IBO's point--that the MTA had an incentive to maximize the price it received--raises questions about whether the MTA did do that.

Arena benefits

The Post article continues:
Anticipated arena financial windfalls include a record $400 million naming-rights deal signed with Barclays Bank and up to $35 million annually through the sale of luxury suites.

Ratner has an option to buy the arena at market value after 30 years, records say. But it doesn't pay because the average life span of an NBA arena is about three decades, and he is eligible to continue the buck-a-year lease arrangement for up to 99 years.

Indeed, the naming-rights deal and the sale of suites, as I've suggested, should be able to pay off the PILOTs. No wonder Ratner wants to go ahead with building the arena. Note that the paragraph directly above appears only online.

Some calculations

The online article continues:
Other benefits for Ratner include:

* Saving $261.25 million in taxes through tax-free bonds that will finance affordable housing, White said.

Note that this number doesn't appear in the print article; it's worth getting current officials to confirm it. Tax-free bonds for affordable housing are not special benefits; everyone building such housing applies for them. The problem, however, is that as of now there's too limited a pool of such bonds.

More savings

The online article continues:
* $150 million in tax credits through special state legislation set up to benefit Atlantic Yards, officials said.

* Saving $114.5 million buying the Atlantic Rail Yards site for the project at less than the MTA's own appraised price.

Note that the two points above, as well as the PILOT deal and $305 million in direct subsidies, are part of the graphic in the print article.

Note that the MTA did not sell the 22-acre "Atlantic Rail Yards site" but instead the 8.5-acre Vanderbilt Yard. (Forest City contends that the value of railyard improvements ups the value of its bid. Develop Don't Destroy Brooklyn disagrees. Note that the DDDB analysis here responds to a $50 million cash bid from FCR; it was raised to $100 million.)

FCR's response

The article quoted the developer:
Ratner spokesman Loren Riegelhaupt refuted most of the subsidy estimates made by White and the Post, adding "it is too early to know" the exact tally and that the only subsidies currently guaranteed are $305 million coming from the state and city for infrastructure and land-acquisition costs.

"Yes, there's investment from the city and state, but what they get back is even greater," he said.

He added that the entire project will eventually be built and bring in nearly $1 billion in net tax revenues over the first 30 years, create over 21,000 permanent jobs and construction jobs and 2,250 units of affordable housing for low- and middle-income families.

The print article ends here. I'm not sure that Riegelhaupt refuted the calculations, since refute, to me, means "to prove wrong," but the dictionary says a secondary meaning is simply to "deny the truth or accuracy of."

Online only

The rest of the article didn't appear in print, and it contained some of the most important news:
Assemblyman Richard Brodsky (D-Westchester) warned that Ratner must deliver what was promised when the state approved the project in December 2006.

"All the big projects -- the 7-line, downtown Manhattan, Hudson Yards, Atlantic Yards -- they're all hanging by a tread, and the notion the taxpayers are going to invest money while the developers don't meet their commitments, if that's what people expect, there is going to be a fight about it," said Brodsky, who chairs the Assembly committee that oversees state entities that approved these projects.

Spokespersons for the city and state said it's unclear whether Ratner would receive more subsidies if he asked, adding it would need to be reviewed. But some Brooklyn-based council members have said their dead set against giving Ratner more cash.

If "it's unclear," that means the door is still open and, given that new elected officials eventually will emerge, the "Atlantic Yards permanent campaign" is hardly over.

Closing words:

The article closes:
While Riegelhaupt said Ratner plans to break ground on the arena and one of the residential towers later this year, construction on other parts of Atlantic Yards is being pushed back because of the downtown in the economy.

Project opponents, however, are still attempting to block the entire project through pending lawsuits.

It's not just the downturn in the economy; there are no housing bonds as of now.

The Post's calculations

The online version of the article provides these calculations:
RATNER'S NETS GAIN

PROJECTED ATLANTIC YARDS SUBSIDIES (SAVINGS TO BRUCE RATNER)

* 1. Arena real estate tax savings through 30-year Payment in Lieu of Taxes (PILOT) agreement with state = $1,032,740,000

* 2. Taxes saved on $1.406 billion federal-state-local tax-free bonds to create affordable housing = $261.25 million

3. Cash from New York City for infrastructure and/or land acquisition costs = $205 million

* 4. Taxes saved on estimated $1.032 billion fed-state-local tax-free bonds to finance $950 million arena = $191.9 million

5. Tax credits through special 421-a "carve out" state legislation = $150 million

6. Savings from purchase of Atlantic Rail Yards at price less than MTA appraisal= $114.5 million

7. Cash from New York State for infrastructure costs= $100 million

* 8. Mortgage recording tax exemption (on residential buildings) = $39.37 million

* 9. Value of city land under arena given to developer= $27.1 million

* 10 Potential tax credits for low-income housing units= $18 million

* 11. Sales tax exemptions (only arena) = $17.4 million

12. Sale tax exemptions (other than arena) = Undetermined

13. Extra funds for "extraordinary infrastructure costs"= Undetermined

14. Credits for public utilities relocation= Undetermined

GRAND TOTAL=AT LEAST $2,151,890,000

* Estimations by Michael D.D. White, an urban planner and former top lawyer for New York State's finance authorities, after reviewing public documents. Other figures based New York Post examination of state records and interviews with government officials.

Note: Atlantic Yards is estimated to cost $4 billion.

Remember, the project would cost more than $4 billion.

The Prospect Heights Historic District nudges forward

A potential Prospect Heights Historic District remains on track, though the process could take two years, representatives from the city Landmarks Preservation Commission (LPC) told an attentive, supportive, and sometimes wary audience last Wednesday night. The meeting, called by the Prospect Heights Neighborhood Development Council (PHNDC), drew more than 130 people, many of them homeowners, to P.S. 9 on Underhill Avenue. (Here's my report from a similar meeting last September.)

“We have long been aware,” said PHNDC president Gib Veconi, opening the meeting, “that residents here place a tremendous value on historic architecture and character and scale.” Given the strong real estate value and the fact that many properties are developed to their full zoning potential, he said, many historic buildings are being lost to demolition or being altered.

District boundaries

[Updated 4/15] The map shown last Wednesday has been distributed; it is a variation of the outline shown in this map prepared by the Municipal Art Society (MAS).

LPC cautions, "Please note that the map represents the Landmarks Preservation Commission's draft study area of the Prospect Heights neighborhood as of Wednesday, April 9, 2008. The Commission has taken no formal action with regard to this neighborhood. This map is in no way a final boundary proposal and may be modified by the Commission at any time."

(Note that the Atlantic Yards footprint is not included; LPC officials have said they weren't going to look at an area under environmental review and, of course, there's no reason to clash with the mayor's office. The Ward Bakery, the largest pink segment on the MAS map, is listed as a potential National Register entrant, which does not imply preservation and, indeed, it's under demolition.)

“This is a neighborhood long of interest to the commission,” Kate Daly, the LPC’s executive director told the audience. When, in 2006, the LPC was given new City Council funding to survey neighborhoods, the first on the list was Prospect Heights given community pressure. After all, nearby neighborhoods like Park Slope, Fort Greene, and Clinton Hill have contained historic districts for more than a quarter-century, and North Crown Heights was designated last year.

What next?

Mary Beth Betts, director of research for the LPC, said Prospect Heights would become the largest historic district designated in some 18 years, with more than 700 buildings examined, LPC staff walked the neighborhood for three months.

The process to move toward designation involves a detailed report by the LPC’s Research Department, which sends draft copies of each building description to its owner for review and comment. The Commission then votes on the designation at a public hearing--in the case of Prospect Heights, probably before the end of the year.

The City Planning Commission then must hold a hearing, with 60 days to submit a report to the City Council “on the effects of the designation as it relates to zoning, projected public improvements, and any other city plans for the development or improvement of the area involved.” Then the City Council has 120 days from the time of the LPC filing to modify or disapprove the designation. A majority vote is required.

Effect of changes

A designation doesn’t freeze development but it regulates changes to the exterior of buildings--and makes such changes more expensive. However, as Daly pointed out more than once, it generally leads to a rise in property values.

While most in the audience seemed supportive of the designation--here are some comments to PHNDC--there were some skeptics. Some wondered whether protecting the neighborhood had much value, given that potential encroachment of Atlantic Yards. (State Senator Eric Adams and Richard Moe of the National Trust for Historic Preservation, in a PHNDC flier, both cited AY in stressing the importance of landmarks designation.)

Some worried that the strictures would be too costly. And one wondered whether designation would further diminish diversity, driving away low-income artists. "There’s no study of income diversity,” Daly said, insisting that a historic district doesn’t cause gentrification. (Well, that’s arguable; if property values go up, rents go up, unless there are rent-regulated buildings.)

Sarah Carroll, LPC's director of preservation, told the audience that the LPC regulates only the exterior only, not the interior, and that 90-95% of applications are reviewed by LPC staff rather than the commission. She said LPC staff were “available for pre-application consulting” by homeowners concerned about their choices.

In several cases, residents questioned why certain blocks, or portions of them, weren’t included in the map. Betts said she’d reply to queries after checking files in the office.

Why now?

Some residents wondered, essentially, why now. “You didn’t stop Ratner,” one said. “You didn’t stop the [Richard Meier] glass building on Grand Army Plaza.”

“It’s not to stop development,” Daly replied. “It’s to preserve a sense of place.”

Many buildings are already out of character, the questioner pressed. Such alterations, Daly responded, don’t outweigh the quality of the district.

Another resident served a fat pitch to Daly, citing to a “very lovely freestanding house” demolished under an alternation permit. (Other examples cited by PHNDC include the photos at right.)

“Would landmarks prevent that kind of demolition by stealth?”

Yes, Daly replied.

Later, the issue recurred, when an audience member said, “I don’t see anything in this process that helps protect” against a development like Atlantic Yards.

An audience member responded that, as of now, someone could knock down five contiguous buildings and construct something quite out of scale.

Still, some were concerned that the process couldn’t protect, for example, against shadows caused by giant buildings on the border of the district, buildings that sounded a lot like Atlantic Yard.

“We’re not able to stop development outside the boundaries,” Daly acknowledged. “But this would be a tremendous accomplishment.”

Questions of money

Is there a mechanism to compensate owners for the loss of their development rights if they can't build to their full Floor Area Ratio, one audience member asked.

No, said Daly, who pointed to a September 2003 Background Paper by the Independent Budget Office, The Impact of Historic Districts on Residential Property Values, which concluded that:
All else equal, prices of houses in historic districts are higher than those of similar houses outside historic districts.
Although prices for historic properties have at times increased less rapidly than for similar properties outside historic districts, overall price appreciation from 1975 through 2002 was greater for houses inside historical districts.

“There is an inherent value to owning a house in a historic district,” she said, noting that someone who buys a vacant lot to build is not required to construct a building in a “historicist style.” Similarly, current conditions are grandfathered in, so homeowners are not required to install “historic” fixtures to replace them.

“Living in a historic district absolutely means you have more regulation,” Daly acknowledged, “[but] it protects you.”

Could a homeowner install solar panels? Yes.

Do windows that pass muster cost more? Yes, responded Carroll, adding that they last longer.

What about cash-poor homeowners stressed by the costs of renovations? LPC has “a very small grant program based on income,” Carroll said, adding that the New York Landmarks Conservancy can provide more support.

Looking forward and back

Julia Vitullo-Martin of the Manhattan Institute likes to quote a line from planner Peter Salins, "In a post-industrial age, a city's face becomes its fortune." Indeed, the historic districts are part of what give Brooklyn such a rich sense of place.

They're also part of why Brooklyn has become increasingly expensive. Just as the city has coupled downzonings that limit development with upzonings that increase development rights and accommodate growth, so must it figure out ways to grow while preserving its face.

In the rezoning of Park Slope's Fourth Avenue, for example, the city ignored the tradeoff between increased development rights and subsidized housing.

In the case of Prospect Heights, some landmarking is obviously long overdue, just as the recognition that development over--and near--the MTA's Vanderbilt Yard was overdue.

Had a historic district been established sooner, it might have encompassed more of Dean Street, or perhaps designated individual buildings--and Forest City Ratner would have proposed a different map.

The end of the Times's City section editorial and op-ed page

I was waiting for someone to notice the demise of the op-ed and editorial page of the Sunday New York Times City Section and, more than three months later, the New York Sun did so.

On Tuesday, in an article headlined Paper Ends a City Feature, Stirs Discontent, the Sun reported:
In a move that some readers and former contributors say demonstrates a decreasing devotion to local coverage, the New York Times has halted production on the editorial and op-ed pages of its Sunday city section, ending a three-and-a-half-year experiment.

"It had promise," a former parks commissioner who is the director of New York Civic, Henry Stern, said. "I'm sorry the page is gone." The newspaper's city section was created in 2004 to allow more space for local issues as the main editorial page increasingly marketed itself to a national audience. The section's editorial and op-ed page focused on city policy, offering opinion on local issues ranging from electronics recycling to subway management to homelessness.

The December 30 Times included a short announcement that the editorial page would be removed, and stated that "while the section is changing, the editorial department's commitment to presenting issues and opinions of importance to New York City remains as strong as ever." A spokeswoman for the Times, Diane McNulty, said editorials relating to the city were moved into the main paper to provide "editorial coverage of New York City issues to a larger range of our readers."

One contributor observed that the Times considers itself such a national paper that it "is above these minor, pedestrian, provincial issues."

[Update: I should point out that the New York Observer noticed it right out of the box, with a 1/1/08 piece quoting Times managers defending their decision but not quoting pundits dismayed by the move.]

The AY effect

I was critical of the Times for relegating the first Atlantic Yards op-ed (and the only one before two state bodies voted on the project) to the City section.

And I was critical of the Times for running editorials about AY in the City section, noting:
I'll repeat for the record that limiting the editorial's audience to readers in the five boroughs is a disservice to the public. Not only would state subsidies be part of the public support, the project would have an impact in the tristate region and also nationally. It deserves broader scrutiny.

My comments assumed the presence of the City section. However, the net loss in space for editorials and commentary means that it's even harder to shoehorn in coverage of issues like Atlantic Yards.

I'll repeat Brooklyn College professor Paul Moses's observation about Brooklyn's place in the local mediascape: Nowhere in the country do so many people get so little local coverage.

In need of correction: the AY housing page

From the official Atlantic Yards web site, a page in need of significant correction, given the news of the Atlantic Yards stall.

FCR sharing information? Not quite

Develop Don't Destroy Brooklyn is savoring the pious promise made by Forest City Ratner spokesman Loren Reigelhaupt, who told the New York Observer in February, “When it comes to sharing information with the public and governmental bodies, there’s no such thing as too much, as far as we are concerned."

As DDDB points out, for the third time, the developer isn't exactly answering questions from the press. (FCR routinely ignores questions from the Brooklyn Paper and also from me.)

Forest City Ratner eighth in state lobbying, but has second-largest contract

You didn't read this in the New York Times (or several other media outlets), but Forest City Ratner, though dropping to a eighth among lobbyists statewide in 2007, still managed the second-largest lobbying contract. In the 2006 tally, the developer was third in total lobbying and had the largest lobbying contract.

Significant FCR spending in 2006 was understandable; the project was approved that year by the Empire State Development Corporation and the Public Authorities Control Board.

However, the continued spending reminds us of the "Atlantic Yards permanent campaign;" even though the project has received official approval, much more, including a special 421-a tax break (achieved) and a campaign for additional subsidies (anticipated) was on the developer's agenda.

State report issued

On Wednesday, the New York State Commission on Public Integrity (CPI) released its 2007 Annual Report. The CPI, created by the Public Employee Ethics Reform Act of 2007 (an achievement of Gov. Eliot Spitzer), combined the staffs, jurisdictions, powers, duties and functions of the New York Temporary State Commission on Lobbying and the State Ethics Commission. (The figures cover lobbying at the city and state level.)

The press release states:
O'Brien & Gere Limited had the largest lobbying contract, valued at $1,547,812. The firm lobbies on its own behalf. Forest City Ratner Companies, a commercial real estate company, had the second largest contract with Fried Frank Harris Shriver & Jacobson, LLP, valued at $771,170.

Actually, as an appendix to the report shows, Forest City Ratner's contract went up, a 17.5% increase from $656,520. (Overall lobbying by FCR, however, decreased 45% from $2,105,141 to $1,160,186.)

The New York Public Interest Research Group (NYPIRG) issued a chart (above) that combined lobbying expenditures with campaign contributions. Forest City Ratner comes up zero in the latter. We know that may be true for 2007 but not for 2008, given the $58,420 contribution in January to the Democratic Assembly Campaign Committee's Housekeeping account.

And we know that the developer has other ways of currying favor, such as via the shadowy Forest City Ratner Companies Foundation.

In the Post

Yesterday's New York Post, in an article headlined (online) TEACHERS 'BUY' ALBANY: UNIONS DROP $3M TO LOBBY, focused on the "whopping $3 million" spent by the city and state teacher unions, a figure "revealed the day after the teachers unions successfully stymied a measure, backed by Mayor Bloomberg and Schools Chancellor Joel Klein, that would have allowed student-performance data to be used in determining teacher tenure."

The report, however, shows that the categories of Health & Mental Hygiene and Real Estate & Construction spent the most on lobbying.

Lower in the article:
The Trustees of Columbia University spent $2.3 million on lobbying state and city officials last year, the second highest total behind Verizon's $3.2 million.

And Forest City Ratner Companies, which is looking to build an arena for the NBA Nets in Brooklyn, spent $1.2 million on lobbying in New York last year, the eighth highest total.

It's a lot more than an arena, actually.

Note that, while the article above that I scanned is cut off, the graphic does include the Top Ten lobby clients, including Forest City Ratner.

In the Daily News

The New York Daily News took care of it in a Daily Politics post, headlined Big Bucks = Big Influence In Albany. It mentioned the top lobbying firms and the top three clients, but not Forest City Ratner.

It did link to the NYPIRG chart reproduced above, which includes Forest City Ratner.

On Brian Lehrer

As a guest on the Brian Lehrer Show yesterday, Blair Horner, legislative director for NYPIRG, offered comments on the report. Lehrer touched only briefly on Atlantic Yards, at about 1:50, as he went through the list, saying, mock-quizzically, "Number 8, Forest City Ratner, what could they possibly want--hmm?

At about 6:20, Lehrer asked Horner for general observations on where lobbying money goes.

Spending big bucks

Horner responded, "Typically, if you're spending big bucks, trying to influence opinion makers, they're spending it on well-connected lobbyists.... You're also spending it on different kinds of advertising, it could be polling, it could be direct mail pieces to individuals at the grassroots level, it could be TV ads....

So when you get into the big bucks categories like this, you have major things going on, well-connected lobbyists combined with some advertising activity and direct communications to membership or people they believe to be allied to them, and that's the typical modern-day lobbying activity that you see, the connection between the insiders as well as the kind of Internet-based and TV-based advertising efforts, radio-based, to drive the process. Clearly, they wouldn't spend all this money if they didn't think it worked."

Indeed, Forest City Ratner uses insiders, like Fried Frank lawyer Melanie Meyers, a former general counsel to the Department of City Planning, as well as a series of slick brochures (so far, seven), produced by a political consulting firm.

In the Times

Last year, the Times covered news of the annual report in its blog. This year, the Times has ignored it.

However, separate but similar information from Project Sunlight, a database created by Attorney General Andrew Cuomo's office, generated more extensive Times blog coverage and even an editorial last December.

Why was the latest report ignored? Was it because the Times already wrote about Project Sunlight? Was it that the Times considers itself a national newspaper, so such nitty-gritty information important to New Yorkers isn't so crucial? Or was there, as a reporter in the Gannett Albany bureau suggested, a question of timing:
It’s curious, though, that the highly criticized commission handed its annual report today—when most of the media is focused on the state budget and the report, which usually garners headlines, will be overshadowed.

Whatever the reason, the readers are underserved.

Errol Louis and the "Atlantic Yards pork pool"

Daily News columnist Errol Louis cares about politicians giving away the public's money, but not when it comes to Atlantic Yards.

In a 4/6/08 column headlined Speaker Quinn and her pork pool, Louis wrote:
It seems there is no limit to how much of the public's money politicians will steal, waste and abuse if we don't keep a close and skeptical eye on them. The piggies have been busy lately, and it's going to cost us plenty.

What we know so far about the budget scandal engulfing the City Council is that the Council has, since 2001, allocated $17 million by giving grants to nonexistent organizations.

"Local selfishness"

Remember Louis's exchange about subsidies with Assemblyman Richard Brodsky in September 2006. The “local selfishness” regarding subsidies, Louis said, is something “I accept as the lay of the land… If they’re going to get a billion-dollar TIF [tax-increment financing] deal in Rensselaer County, I think where I live, in Kings County, if somebody wants to bring a billion-dollar deal there, with way too much paid per job, in my neighborhood, where there’s a lot of unemployment, personally, I would say, ‘You know what? I’ll take that.’”

Brodsky was unimpressed. “That is a prescription for a bigger disaster. ‘My pork is good. Your pork is bad.’ is not a principled response to the pissing away of billions of dollars.”

AY subsidies

A day after Louis's column about Quinn, I reported that, despite $305 million in pledged direct public subsidies for Atlantic Yards, a top executive told investment analysts that "we still need more” subsidies.

Will Louis address that? Nah. A column last month about Atlantic Yards suggested that "those who want prosperity and progress in Brooklyn" project should, among other things, "negotiate improvements to the plan with Ratner."

And today, rather than criticize the "Atlantic Yards pork pool," Louis, in a column headlined Building a better economic outlook, writes a valentine to Avi Schick, acting CEO of the Empire State Development Corporation, an "unsung hero" who keeps "the machinery of growth humming in good times and bad."

Community layoffs?

Louis quotes Darnell Canada of Rebuild:
"I had 10 guys straight out of the community who we trained to be apprentices in construction safety, and another 10 in line behind them," Canada tells me.

All the trainees were unemployed, says Canada, half of them living in the Fort Greene housing projects (as does Canada). They took courses on the ins and outs of construction safety, including spotting when a crane is leaning dangerously and learning how to prevent tons of dirt from spilling and suffocating workers.

The first of Canada's trainees were hired at Atlantic Yards but recently got laid off as the souring economy caused the project's developer, Bruce Ratner, to delay the project. According to Ratner, it will take longer than anticipated to build the commercial skyscraper and 6,400 apartments that will surround a planned basketball arena.

"These were real good jobs. After a year as an apprentice, you take a test and start making $55 an hour - not just a worker's position, it's management. And there's so much need for safety management on these sites, it's crazy," Canada says.

(Canada, a veteran community activist, is also known for his ominous "You're the victim" speech at the hearing on the Atlantic Yards Draft Environmental Impact Statement, captured in the film "Brooklyn Matters." Next screening May 1.)

Looking more closely

Louis's summary--"According to Ratner, it will take longer than anticipated"--is supremely sketchy, given the longstanding lack of affordable housing bonds and the fact that the project, when it was approved in December 2006, was behind the announced construction schedule.

As for the jobs, it's not at all clear how many people have been hired from the Fort Greene projects and how many of those jobs are on the $55/hour track.

According to a February 6 Report to the Downtown Brooklyn Advisory & Oversight Committee prepared by Forest City Ratner, about $46 million in contracts had been awarded at the time, with 21 placements from the Community Labor Exchange.

That's about one local job for every $2.2 million in contracts. (Of course there are more jobs in total. Then again, at least $55 million in public funds has already been distributed.) There were only three jobs from any one zip code, including that containing the Fort Greene projects (11201).

A less contentious process for developing at the MTA's Vanderbilt Yard might have resulted in a smaller project but one that proceeded more rapidly, with jobs for community members.

But in this case, rather than "keep a close and skeptical eye" on the politicians, Louis essentially endorses the concept of "My pork is good. Your pork is bad."

He quotes Schick:
"What regular people want is for development to happen," Schick says. "They're not interested in whether it satisfies every critic and whether it's the most perfect thing. They say life is difficult, there's not enough apartments, not enough jobs, not enough transportation and they want better. They just want it delivered.

Maybe they do. And maybe developers want more subsidies, too.

The congestion pricing votes: AY wasn't the issue, nor was overbuilding

A project like Atlantic Yards--a traffic magnet like the arena and the attendant residential influx--would bring a lot of traffic, especially with more than 3600 parking spaces.

So congestion pricing (CP) would seem to be a solution. However, as the recent defeat of Mayor Mike Bloomberg's congestion pricing proposal suggests, local political considerations trump the long-term public policy issue. The politicians with the most at stake regarding Atlantic Yards were decidedly mixed in their approach.

For example, City Council Member Letitia James, an Atlantic Yards opponent, supported CP. City Council Member Bill de Blasio, a longstanding but increasingly critical supporter of AY, represents a district that suffers as much from traffic as does James's district. But his opposition to CP likely derives mainly from his need to court votes throughout Brooklyn in his run for Borough President.

Last November, Streetsblog, which offers savvy advocacy for and analysis of congestion pricing, characterized the performance of Brooklyn officials at a public hearing as Profiles in Discouragment.

The RPA's warning

While such major traffic changes were deemed beyond the scope of the AY environmental review, on 8/22/06, the Regional Plan Association, in its convoluted Atlantic Yards testimony, warned that "a long-term comprehensive transportation plan" including congestion pricing was needed to stave off the worsening of existing congestion:
Rather than putting a halt to all development, proactive steps must be taken to limit the congestion and allow growth. Much of the traffic that ties up this part of Brooklyn for much of the day is generated by cars and trucks going to and from the free bridges over the East River. Over the long-term, the most effective way to reduce this congestion will be to implement a congestion charge for entering the Manhattan CBD from all directions that provides incentives for traveling in non-peak times and taking transit. This may not be a solution for this year, but if it is not in place by the time the bulk of this or any other development comes on line, the area’s congestion may become untenable.

Why did it fail?

Is Sheldon Silver to blame, as Bloomberg said (and the Times editorialized), or is the mayor, as Daily News columnist Juan Gonzalez suggested? Or was it just that fact that suburban and rural legislators understandably voted their self-interest, not the long-term public interest?

Charles Komanoff offers a series of reasons in a Grist magazine column; check the comments for replies from Assemblyman Richard Brodsky and Komanoff's rebuttal.

Meanwhile, Gene Russianoff offers some interim solutions.

Overbuilding the culprit?

In a column on Ron Howell's Brooklyn Ron blog, Paul Moses of Brooklyn College (and formerly New York Newsday) offers an alternative interpretation of the CP failure, suggesting that overbuilding has caused ruinous traffic and it's time to dial back:

Of course, the group that initiated the congestion pricing plan - The New York City Partnership, lobbying arm of the Chamber of Commerce - would never go for that. It presented congestion pricing in an attractive green package, but underneath the wrapping, it was just an attempt to open up Manhattan for further real estate overdevelopment by the Partnership's members.

...Despite all of the environmental studies that are done, the truth of the matter is that development in Manhattan and, more recently, downtown Brooklyn, is carried out with little or no concern among most elected officials and the business community for increased traffic congestion and the air pollution it causes.

...It is hard to understand how Mayor Bloomberg expected drivers to make this sacrifice when he had pursued construction of a new stadium that would have drawn thousands more cars into Manhattan and when he had championed massive development that would aggravate the already congested traffic situation in downtown Brooklyn.

Moses is right to point out that Bloomberg was a latecomer to CP, prodded by the Partnership and the New York Times, and he's right to point out that development has been approved without attention to traffic congestion.

Still, CP and development are hardly incompatible--the issue is one of degree and of linkage. Even without Atlantic Yards, there'd be an argument for significant development near the Atlantic Terminal transit hub and in nearby Downtown Brooklyn, given that subway access.

However, as Moses suggests, Bloomberg and other development-supporting politicians missed the opportunity to say they'd only support such projects if they were accompanied by massive changes regarding traffic and transit.

In December 2006, I asked the Partnership's leader, Kathryn Wylde, why the group supported Atlantic Yards without CP in place. Her response: “Well, Atlantic Yards development is over a long period of time. So hopefully we’ll have some solutions on the congestion side before we hit that critical mass, in terms of additional traffic."

In other words, eventually it'll sort itself out--long after the terms of politicians like Markowitz.

Looking at the electeds nearest AY site

A quick news and blog search, mainly via Streetsblog, turns up the following positions on CP among the ten elected officials with the most at stake regarding AY. (These are the ten asked to nominate representatives to the AY Community Advisory Committee, which still hasn't gotten off the ground.)

Note that the categories below of "Critical supporters" and "Mild opponents" are inexact and fluid.

Boosters

Borough President (and potential Mayoral candidate) Marty Markowitz: conciliatory opponent of CP.

Rep. Yvette Clarke: position unknown (but Streetsblog says she should support it).

Critical supporters

City Council Member (and Comptroller candidate) David Yassky : early supporter.

City Council Member (and Borough President candidate) Bill de Blasio: opponent.

Assemblyman Hakeem Jeffies: surprising opponent.

State Senator Eric Adams: on the fence.

Mild opponents

Assemblywoman Joan Millman: belated supporter.

Assemblyman (and Comptroller candidate) Jim Brennan: supporter of an alternative. (Note: the Daily News, in its survey of Assemblymembers, counts him as a "yes.")

Opponents

City Council Member Letitia James: supporter.

State Senator Velmanette Montgomery: unclear, but leaning opposed. (Update 4/12: in this week's issue, the Courier-Life reports that she was for it. If so, she was pretty quiet.)

Reading the Paterson tea leaves: AY unmentioned in speech about development

Governor David Paterson's speech Monday (video from The Observer) to the Association for a Better New York took on the following topics: the MTA, Ground Zero, congestion pricing, the Second Avenue Subway, the East Side Access project (bringing the suburban Long Island Rail Road to Grand Central station), Moynihan Station, and Governors Island.

Unmentioned: Atlantic Yards.

Does the fact that he's not pushing the project means he's opposing it? Nope.

Perhaps it just means that he's taking a hands-off attitude for now, as Forest City Ratner waits for the market to change. But will he support more subsidies for the project?

What Paterson said

From the transcript:
And then we have to go on from there to face other challenges; challenges that we must face right here in New York City. We have to build an infrastructure that will allow us to continue to be competitive. We have to develop the East Side Access. We have to build the 2nd Avenue subway. We have to rebuild the Tappan Zee Bridge, and we have to create a fourth major airport at Stewart Airport. We have to develop the far west side of this area, creating a third downtown center in the downstate region, with the development of the Hudson Yards and the establishment of Moynihan Station.
...And we have to find a workable and sensible plan to develop one of our great civic treasures as we redesign the structure and outlook at Governors Island.

State Senator Carl Kruger and his campaign war chest

The Village Voice's Tom Robbins this week finds Brooklyn State Senator Carl Kruger to be the poster child countering "good-government types." The piece is headlined Living the Political Life Fantastic, with the subtitle "Surf, turf, and doughnuts: A state senator dines out on his campaign war chest."

Before we go to the details, let's remember some other elements of Kruger's record: he's a supporter of Atlantic Yards and the $6 billion lie; he received $4000 from Bruce Ratner's brother and sister-in-law; and, though a Democrat, he campaigned for Republican Martin Golden in return for new district boundaries that protected his seat, as recounted by Seymour Lachman in Three Men in a Room.

And, less we forget, Kruger has emerged as a dubious player in the debate over Coney Island, using that considerable campaign war chest to gin up public opposition to the city plan and support for Joe Sitt.

The Ratner connection

Remember, as the Observer's Matthew Schuerman reported 5/31/06, Kruger and fellow Atlantic Yards-loving South Brooklyn politicians come out of the Thomas Jefferson Democratic Club, which also produced Ratner aide Bruce Bender.

From the Voice

Robbins writes:
Kruger is a product of one of New York's last and best-functioning political machines, the Thomas Jefferson Democratic Club in Canarsie. He launched his political career the proper way, as an aide to one of the club's proudest sons, former Assembly Speaker Stanley Fink. When the local state-senate seat became vacant in 1994, Kruger got the nod. He is now so popular that Republicans don't even bother running against him. In his last race, he got 95 percent of the vote.

Despite that electoral comfort zone, Kruger has banked some $1.6 million in his campaign kitty, much of it from city real-estate moguls who appreciate his support. This is more money than even the senate's mighty leader, Joe Bruno, has in his own war chest. Kruger's campaign coffers earned so much interest last year that he had to pay the IRS $22,000 in taxes.

The ombudsman's local office will open (finally)

OK, I'm trying to figure out the headline in today's Daily News story, Community advocate still missing in Atlantic Yards project. Yes, complaints are aired about Empire State Development Corporation ombudsman Forrest Taylor, but those have been aired for months, since he was appointed in late November.

The Daily News reports:
But since November, when Taylor started the job, office renovations and ongoing meetings with city and state officials have delayed his advocacy duties.

"He's been the ombudsman since we hired him and he's been working with the community, but this will be the first time he'll be keeping office hours," said Empire State Development Corp. spokesman Warner Johnston.

Well, he was supposed to be an advocate all along. The news is that his office on Hanson Place apparently will open soon. Right now, he's on vacation.

Are sports facilities "public" recreation? Eminent domain supporters raise questions

Remember the reasoning process pursued by state Supreme Court Justice Joan Madden in determining that the Atlantic Yards arena would qualify as a "recreational" venue under the Urban Development Corporation Act (UDCA)?

Because sports spectatorship is a form of amusement, which is one definition of "recreational," she wrote, the arena qualifies as a facility designed and intended for "recreational purposes," and as such constitutes a "civic project" as defined under the UDCA.

Her ruling came in a dismissal of the state lawsuit challenging the project's environmental review.

An interesting contrast comes in a 2006 paper by two noted supporters of eminent domain and the U.S. Supreme Court's controversial 2005 Kelo vs. New London decision. They raise questions about just how public sports facilities are.

Kelo's Unanswered Questions: The Policy Debate Over the Use of Eminent Domain for Economic Development was written by Robert G. Dreher and John D. Echeverria of the Georgetown Environmental Law & Policy Institute of the Georgetown University Law Center.

Privileging sports facilities?

The relevant comments come in a caution about privileging eminent domain for specific uses, such as sports facilities:
One popular approach to reform already adopted in some states involves prohibiting various specific uses of eminent domain or, what amounts to the same thing, prescribing the allowed uses of eminent domain. This approach seeks to draw clear lines establishing when eminent domain can and cannot be used. The difficulty with this approach is that it turns out to be very difficult to make reasonable generalizations about when the use of eminent domain is appropriate. Apparently because professional sports teams tend to be popular, some enacted and pending legislation provides wide latitude for the use of eminent domain to develop sports stadiums. But, as a matter of principle, it is difficult to understand how one can distinguish between stadiums and other privately-owned public entertainment venues, such as movie theaters and theme parks. Moreover, it is hard to see why sporting arenas, which are accessible only by admission-paying customers, are considered more “public” than shopping centers, which may in a sense serve a lesser civic function, but at least are accessible to all without charge.
(Emphasis added)

In other words, following this logic, a movie theater could qualify as a civic project. And, perhaps, Shoot the Freak.

AY loophole

However, the Atlantic Yards arena wouldn't be privately-owned, thanks to a loophole. As noted by the federal appellate court upholding the dismissal of the federal eminent domain lawsuit, the facility would be
a "publicly owned (albeit generously leased) stadium." That lease would be $1, as noted in the General Project Plan (GPP), excerpted at right.

According to the GPP, that leaseholding Local Development Corporation will issue tax-exempt bonds to pay the cost of building the arena, and a Forest City Ratner affiliate will repay the bonds as payments in lieu of real estate taxes "not to exceed the amount that full real estate taxes would be if the land and improvements were not exempt from such taxes as a result of ESDC's ownership thereof."

More warnings

In their paper, Dreher and Echeverria offer other warnings about singling out certain uses:
The prohibitory strategy raises a number of other serious problems. First, it strikes at the heart of efforts to rely on public-private partnerships to promote mixed-use development; bills adopting this approach typically prohibit the use of eminent domain for certain types of uses included in mixed-use developments, jeopardizing the entire mixed-use approach to development. In addition, this approach only helps property owners threatened with redevelopment that includes proscribed uses; owners affected by other government-sponsored development activities, such as highways, utility lines or, depending on the legislation, sports stadiums, or whose property has been designated as “blighted,” receive no protection whatsoever. Finally, Professor Thomas Merrill has observed that property owners will have difficulty obtaining legal representation to protect their rights under such prohibitory approaches, since the relief they will be seeking is an injunction preventing the taking of their property rather than enhanced compensation which could attract lawyers to serve on a contingent-fee basis.

Ratner, the deputy mayor, the "Wild Card" BP, and the conversion of subsidies into philanthropy

The Brooklyn Museum's Brooklyn Ball 2008 Thursday honoring developer Bruce Ratner was not merely an opportunity for various private sector entities, including several associated with Forest City Ratner, to salute the guest of honor.

Representatives of our elected officials were there as well. We know that Brooklyn Borough President Marty Markowitz appeared; he was visible through the museum's glass-walled entrance plaza, and he generated some spirited (and mean-spirited) heckling.

A Deputy Mayor's presence

But no one at the demonstration outside recognized Deputy Mayor Patricia Harris, who was Mayor Mike Bloomberg's chief philanthropic advisor at Bloomberg, L.P., and her portfolio includes arts organizations.

(The New York Observer, in a 5/30/04 article co-reported by a capable journalist named Lizzy Ratner--Bruce's daughter and a Nets co-owner--described Harris as dressing down officials from arts organizations who had contributed to the campaign of City Council Speaker Gifford Miller, a potential mayoral candidate.)

The "Wild Card" of swag

Note that the "Schedule of Podium Remarks" (sent to me by an anonymous source) misspells Frank Gehry as "Ghery" and declares Markowitz, whose schedule is variable, as a "Wild Card."

Indeed, the museum might have gotten more of a "Wild Card" than it expected when Markowitz's wife, Jamie Snow, scooped up eight valuable one-per-guest plexiglas placemats, as reported by Radar and the Daily News. (Note Radar's follow-up.)

"Everyone is scrambling to take home one of the custom placemats," reported the enthusiastic Melena Ryzik in a video for for the Times.

Hmm--if the Murakami placemats are indeed worth $500-$1000 each (here's an eBay sale), and attendees at the ball paid $1000 a plate, do they get a full tax deduction? Did the Museum deduct the value of their swag from their tickets?

At the end of the video report, Ryzik declared that, though many glitterati were leaving for the after-party in Manhattan, "It was a very successful evening. There was dinner, and auction, and Kanye West on the first floor, and tons of art in the galleries. Everything took place in an incredible world of cuteness. It was so adorable. It kinda makes me just want to stay here, live here, with the kawaii, the cuteness."

(The segment included a bare mention of Ratner, and of the protest, which located AY in "downtown Brooklyn.")

Giving and giving

The ball (menu at right) raised $1.5 million, according to Bloomberg News, far more than the $100,000 a year given over two years (and, likely, a third) given by the Forest City Ratner Companies Foundation.

Keep in mind, however, that the foundation is but one avenue to donate funds to the museum; Forest City Ratner, as well as individual executives, likely have contributed significant sums, which need not be reported publicly. (So, my headline Thursday should've referred to the foundation alone, not the company.)

Another Harris connection

Harris has been the point person for Ratner contributions to a city charity launched by the mayor. On 4/1/07, the New York Observer reported:
In December 2005, right as the debate over the Atlantic Yards complex was heating up and before the city made several crucial decisions about the project, Forest City Ratner gave between $450,000 and $1 million to a nonprofit closely associated with Mayor Michael Bloomberg.

The donation came six months after a meeting with Mr. Bloomberg and Deputy Mayor Patricia Harris that Atlantic Yards developer Bruce Ratner reported was a lobbying contact—although the parties now dispute that it should have been characterized as such.

The money, from "three different entities of Forest City," reported the Observer, went to the Mayor’s Fund to Advance New York, of which Ratner is a board member, to restore a historic carousel at Coney Island. (The foundation, as I reported, has contributed only $25,000 to the Mayor's Fund.)

Buying influence?

The Observer checked in with a good-government advocate:
“It is not the same as a campaign contribution, but it nevertheless is a contribution to a cause that is dear to the Mayor’s heart,” said Megan Quattlebaum, the associate director of Common Cause New York, a lobbyist watchdog organization. “I think it’s fair to say that Forest City Ratner has used a number of different strategies to advance the Atlantic Yards project. The open question for the public is whether this is part of the larger effort, or whether it is a charitable effort with no self-interested motivation.”

The same could be said about other charitable endeavors. And, given that the developer relies crucially on public funding, it's a lot easier to spread the wealth.

In many ways, we may be paying for the philanthropy. Kawaii, indeed.

Block association calls for a moratorium on AY demolitions

From a letter from the Dean Street Block Association, 6th Avenue to Vanderbilt, to Governor David Paterson and President and Chief Operating Officer of the Empire State Development Corporation Avi Schick:
Over the past few weeks we have learned that the schedule for construction of the Atlantic Yards Project is far longer than originally planned, and that there is doubt about whether Phase II of the Project as originally planned will ever reach the construction stage. Despite this news, there is ongoing demolition activity at the project site which may now be wholly unnecessary and which is having and will continue to have a long-term significant impact on the surrounding community. We are writing to ask that you cease all demolition on the site temporarily, and in particular on the footprint of Phase II. Before moving forward there must be a new review of the construction schedule, sequencing, and rationale in light of the changed circumstances.

More on Brownstoner.

Forest City tells investment analysts: “We still need more” subsidies

While developer Forest City Ratner initially got the city and state to supply $200 million in direct subsidies for Atlantic Yards, then extracted an additional $105 million from the city, that's not enough.

“We still need more” subsidies, Chuck Ratner, president of parent Forest City Enterprises (FCE) told investment analysts in a conference call last Wednesday. It confirms the clue, as noted in the most recent 10-K filing, that the developer seeks more public support before proceeding with the project.

That might generate pushback from some elected officials. “There has already been very generous public investment,” City Council Member (and Brooklyn Borough President candidate) Bill de Blasio recently told the Brooklyn Paper. “I don’t see how we can go any farther.”

Chuck Ratner's comment further undermines sports economist Andrew Zimbalist's unwarranted prediction, in his FCR-commissioned "promotional study":
Although the MOU [Memorandum of Understanding] refers to the possibility of additional optional contributions from the city and state, it seems unlikely that such payments would be made and, in any case, it would be entirely speculative to assign a dollar figure to them.

Additional contributions have already been made, and now we know more will be requested.

Revised estimate on lawsuits

Also, while last September another FCE executive suggested that lawsuits in the Atlantic Yards case would be resolved by the end of July 2008, on Wednesday another executive said that “lawsuits may be resolved in the second half of this year”—a caution that, given past over-optimistic predictions, might be taken with a grain of salt.

Sponsorships pay for arena

That executive, Joanne Minieri, president of subsidiary Forest City Ratner, also confirmed publicly what should have been obvious: the Atlantic Yards arena will be financed crucially by partnerships and sponsorships—essentially turning the arena into a marketing device to pay for itself, as I pointed out in January 2007, when the Barclays Capital sponsorship was announced in a gala at the Brooklyn Museum.

It raises the question: why exactly do cities give up naming rights without taking a percentage, especially when the facility is publicly owned, however nominally? After all, that's foregone revenue.

(Here's the transcript, which may differ slightly from the notes I took while listening to the call. Here's brief coverage in the Real Estate Observer.)

Gaining government aid

An exchange near the end of the session, showed company executives admiring their success in gaining government support. The subject was the Frank Gehry-designed Beekman Tower in Lower Manhattan, which will benefit from tax-exempt Liberty Bonds aimed at reviving the area.

Usually, tax-exempt bonds are issued only for subsidized, “affordable” units, but in this case, said CFO Bob O’Brien with satisfaction, “That’s the beauty of the Liberty Bonds, tax-exempt bonds and market-rate units.”

“Gotta like that,” responded an investment analyst.

[Longer excerpts follow.]

Delays

While Chuck Ratner was not referring explicitly to Atlantic Yards, he indicated that for some other projects the company was slowing down:
We’re looking at our entire development pipeline with a much more critical eye in response to realities of the current market. As a result, we’re moving forward only with the strongest projects and slowing or delaying others until those opportunities mature further or economic conditions stabilizes. Having said that, we continue to believe our pipeline is one of our greatest strengths…We have ample liquidity and continue to be able to secure financing.

After acknowledging that Atlantic Yards “has received considerable news coverage,” neither Ratner nor Minieri acknowledged that front-page March 21 New York Times article about the Atlantic Yards stall.

Minieri offered this summary:
We and our partners have been receiving favorable court decisions and now have won 18 separate rulings on the Atlantic Yards project. There have been no adverse decisions. Certain of these lawsuits have been and will be appealed. However, we remain confident of our position.

There haven’t been 18 court decisions and, while there may have been 18 victories including motions, opponents have also won on several motions.

Resolution soon?

Minieri continued:
We are proceeding with the expectation that the lawsuits may be resolved during the second half of this year and the Empire State Development Corporation (ESDC) will move forward with the process to transfer title of the land.

Remember, last September, O’Brien suggested that the lawsuits would be resolved by July 31:
We remain confident in our positions in all legal challenges and we are targeting resolution by the first half of fiscal year 2008.

Working with ESDC

Minieri continued:
In addition, we are currently working closely with the ESDC to complete all project documents in pursuit of this targeted timetable. As Chuck indicated, we continue to proceed with pre-development of Atlantic Yards, whereby certain site work and the construction of the temporary railyard are underway. Design and construction documents are progressing. We are pricing and bidding certain completed design documents. And efforts are under way with the public parties to complete the affordable housing program. We at Forest City remain committed to the residential program at Atlantic Yards and we will continue to work with the governmental agencies and all of those involved.

We have executed the funding agreement with the city and state for the $200 million of subsidy and received an additional $105 million allocation from the city. In February of this year, we received our first funding for the project, $58 million.

Building the arena

She continued:
With respect to the arena, we are working with Goldman Sachs and Barclays Bank on the available taxable and tax-exempt financing alternatives. Sponsorship interest, which is an important driver for the arena financing, remains strong.

Remember, at the Barclays event in January 2007, Mayor Mike Bloomberg said that Barlcays was putting $300 million "into Brooklyn," while the money would go to defray the developer's cost of paying for the $637.2 million arena, not go into the public coffers, as I wrote. (The event was pitched as “It’s time the world gave something to Brooklyn.")

Progress… depends

Minieri continued:
Projects of this size and significance are always subject to changing market demand and economic influences. As a development company, we manage our projects under guiding principles and apply discipline that include monitoring the design and cost risks , financing levels, the equity needed, and the resulting long-term value creation. Atlantic Yards is no different. And upon the achievement of key project milestones, we will proceed as planned. Today’s economic environment is challenging. However, we believe that Forest City’s and the public parties’ interests, continue to be aligned with respect to the successful completion of the Atlantic Yards project.

“Key project milestones” may be a synonym for additional subsidies.

The Times treasure

Chuck Ratner followed up Minieri’s statement:
I just want to point out to everybody this great success we’ve had in the New York Times over these past several years… largely the result of the tremendously talented team we have in New York, led by Bruce Ratner and Joanne Minieri.

The term “New York Times building” was implied, of course, but the term “great success... in the New York Times” reminds us the developer has been treated gently in the editorial pages and quite variably in the news pages, thus helping the developer achieve “tremendous success.”

More subsidy needed

In response to a question from analyst Rich Moore, Chuck Ratner expressed satisfaction in the developer’s relationship with local government, and said he expects more subsidy.

RM: You work very closely with the cities, they’ve always been a source of financing, in part…what are you hearing from them, in this whole thing, is there less desire to participate, or more desire—how do they look at it?

CR: That’s a very provocative question. We talked about it quite a bit at our last board meeting.. look at what Joanne just shared with you, just in these past six or eight months, we got the various governmental agencies, state, city, borough, in New York, to increase their commitments to Atlantic Yards by 105 million dollars on top of the 200 [million] they committed. We still need more. So you look at New York and you realize it’s a huge city, with, obviously, huge challenges and issues, but there’s very few major things that are happening, that are gonna happen. We’re one of the few in these places that continue to offer opportunities for development, in these major urban markets. They clearly have the resources to support them and I think they’ll put them toward these projects. We found that to be true in MetroTech, over the 20 years we did it… so while they’ll have revenue challenges and tax-[inaudible] challenges, I think they have access to the capital to support development, where they think they need it. I think we represent places where they need it.
(Emphasis added)

Actually, it was just the city that upped its contribution. And it's hardly true that Forest City Ratner alone is offering "opportunities for development." Look at the number of bids for the West Side Yards in Manhattan.

Minieri chimed in: With respect to New York, the city and the state, they really put an emphasis on affordable housing program… a project like Atlantic Yards, of such significance really furthers their commitment to the housing program. So as I said… we work very closely with them, because it’s a public private partnership that will enable us to all come together.

Ratner followed up: I’m not aware of a single project, where in the past six months or the past six years, where a public entity has backed out of a commitment… So that’s why… [he lists several projects, and] Atlantic Yards is still proceeding.

"Gotta like" Beekman

Analyst Sheila McGrath brought up the Beekman Tower. Chuck Ratner asked Minieri and O’Brien to “give Sheila a little color” regarding the “tremendous demand on the part of the banks” for the tax-free Liberty Bonds.

JM: Like a billion-two demand for the 204 [million] that we put out there.

SM: And are all the units in that building, they’re all market-rate units?

JM: That’s correct, Sheila.

BO: That’s the beauty of the Liberty Bonds, tax-exempt rates and all market-rate units.

CR: Thank you, Bob.

SM: Gotta like that.

On Wednesday, a landmarking meeting for Prospect Heights

From the Prospect Heights Neighborhood Development Council (PHNDC):
Following PHNDC's request to the New York City Landmarks Preservation Commission for an evaluation of a Prospect Heights Historic District, LPC will present its proposed boundaries for the district at a community forum on Wednesday, April 9 beginning at 7:00 PM. The forum will be held at P.S. 9, 80 Underhill Avenue (between St. Marks Avenue and Bergen Street). Representatives from LPC will also answer questions from residents and business owners.

Note that the Ward Bakery, under demolition, and the rest of the Atlantic Yards footprint are not included in the boundaries.

Times Style writer arches eyebrows at "obligatory chorus" of protesters

The New York Times sends a Style reporter to the Brooklyn Museum's Murakami opening, who arches his eyebrows:
It used to be that good-looking waiters and cold plonk were the sole essentials of a good museum opening. Maybe there were some crackers on a tray. These days, though, no such fete is complete without a little curbside controversy, some wacko bit of theater, a harried staff of professional-event duennas and a guest list that can often seem as if it were composed by shredding the White Pages and picking names out of a hat.

Here, then, at the gala opening of the Takashi Murakami retrospective at the Brooklyn Museum on Thursday, an evening of unseasonal chill and spitting rain, was the obligatory chorus of protesters on Eastern Parkway, raising voices against the developer Bruce C. Ratner...

To those on one side of the museum’s new glass-walled addition, Mr. Ratner is a deep-pocketed patron and, as the museum’s director, Arnold Lehman, said, “a nice boychick from Cleveland, Ohio.” To those at curbside on Eastern Parkway, he was viewed less benignly, as Satan. Most developers are.

“Atlantic Yards is truly going to make a lot of people miserable,” said one protester, Eleanor Price, referring to Mr. Ratner’s $4 billion plan to refashion downtown Brooklyn into a commercial wonderland of shops, a basketball arena and fanciful buildings by Frank Gehry.

Let's just say that if he's calling the site "downtown Brooklyn," an error the Times has corrected in more than a dozen articles, and that this was merely an "obligatory" protest, he's not doing his reading. The Times's CityRoom blog, maybe, thought it was news. Maybe the news side should've sent a reporter.

AY web site talks of suites but not stall

Anyone looking at the In The News page at the official Atlantic Yards web site is getting a rather skewed sense of the news.

At the top of the page are links to tabloid articles about the luxury suites planned for the Atlantic Yards arena. Then comes a link to a Daily News column by Errol Louis (whose last name is misspelled) decrying delays in the project.

There's no link, however, to real coverage of the Atlantic Yards stall, much less news that the developer has 6+ years to build the arena.

The next article listed is from 3/19/08: Former Fort Hamilton High School star and Nets alum Albert King reads to Crown Heights kids as part of "Read to Achieve" program.

Is that all the news you need to keep up with the project?